If Congress lets the Tax Relief Act expire at the end of the year, the applicable estate and gift tax exemptions will be each reduced to $1 million and the estate tax rate will increase to 55%. This could result in a lot of estates having to pay estate tax in the coming year. And with the economy continuing to struggle and both the Democrats and Republicans focused on the 2014 elections we cannot so easily expect there to be an extension of the Tax Relief Act. Portability and gifting are but two of the many options people should consider in this watershed year for estate planning. Estate and gift taxes can be complicated, so the only way to figure out what options are best suited for you and your loved ones is to talk to an accountant and/or qualified estate planning attorney. No one can predict the future, but that does not mean you cannot plan for it and there is no better time than the present.
Jarod A. Cauzza is an associate at Neil Dymott. His areas of practice include estate planning, trust administration and probate. For further information, Mr. Cauzza can be reached at (619) 238-1712 or firstname.lastname@example.org