Estate Planning in This ‘Perfect Storm’

According to experts, now is one of the best times for wealthy individuals to review their estate plans and transfer assets to the next generation. The current $5 million exemption from estate taxes ($10 million for married couples) and the low levels for real estate assets and securities help make this an optimum time to transition assets to the next generation.

The current $5 million lifetime or at death gift amount is another incentive for wealthy individuals to consider transferring assets now, before these tax exclusion amounts change. The $13,000 annual gift exemption amount is yet another incentive to transfer assets under the current tax rates.

The current tax rates are set to expire and revert back to the previous tax rates at the end of 2012 unless Congress acts. However, many experts do not foresee a resolution of the estate tax until 2013.

For more information on how to take advantage of this “Perfect Storm,” see Andrew Osterland, A ‘Perfect Storm’ for Estate Planning, Investment News, Nov. 6, 2011; Andrew Hodes, The ‘Perfect Storm’ for Estate Planning Asset Transition, Journal 2.0 (Beta), Nov. 7, 2011.

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this article to my attention.