Planning at a Time of Uncertainty

Leiha Macauley, an attorney in Boston, has a client who died in May, leaving his $20 million estate to his 93-year-old widow through a simple will. The firm has drawn up disclaimer paperwork that would allow the property to pass to the widow’s children estate tax-free, but they are waiting until the end of the year to file the paperwork to ensure that she lives until then.

Many people are in this same predicament of trying to plan for taxes when planning seems futile.  There are few concrete planning solutions for our current state of uncertainty, but several lawyers and wealth managers offered some suggestions on what to do before the year is over. 

Some are suggesting that clients delay large gifts to charities because the potentially higher income tax rates would mean a more valuable charitable deduction. Further, clients with large capital gains should consider selling these assets and paying a lower capital gains tax this year than next year.

See Paul Sullivan, Planning for Income and Estate Taxes in an Uncertain Time, N.Y. Times, Nov. 12, 2010.

Special thanks to Special thanks to Peter Parlapiano (2011 MBA/M.S. PFP candidate, Texas Tech) and Jim Hillhouse (WealthCounsel) for bringing this to my attention.