Making Gifts to Heirs Now May Reduce Taxable Value

The following is from Brett Arends, Market Turmoil Creates Opening To Enrich Heirs, online.wsj.com, March 15, 2008:

It isn’t all bad news. This winter’s market turmoil is creating a golden opportunity to pass on stocks, mutual funds or other appreciating assets to your heirs.

Plunging stock prices mean you can give more of those assets under the gift-tax ceiling, while the collapse in long-term interest rates has suddenly widened a little-known tax loophole on certain estate-planning trusts.

Put the two together and you could save a bundle on taxes by making bequests right now, especially if you’ve got an estate in the millions.***

The bottom line is that making the gift this way can slash the taxable value, allowing you to pass more to your heirs.***

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.