Block on Trump's Asylum Ban Upheld by Supreme Court
The current estate tax debacle isn't only a mess for Congress. It's causing phones to ring at the offices of estate planners across the country.
Estate planners are left with the riddle that is the current state of affairs -- estimating what the Obama Administration's actions will be with regards to estate tax in the coming years.
Will the pre-Bush era estate tax rates and personal exemption amounts be revived? Or will the government introduce a new scheme, applied retroactively to the date of the lapse? Or, will 2010 go down in history as a tax-free year in estate tax?
So what should you expect from your estate planner, if you are thinking of drafting estate planning documents in the coming year?
Amir, a San Francisco estate planner for medium sized estates says it's business as usual, with a slight caveat to address the 2010 lapse: "We're inserting language about potential death in 2010, to address the changes in the basis rules and to avoid unfunded bypass trust. We give them the disclosure that the law is in limbo."
Certainly, if your estate planning documents make reference to the estate tax exemption amount at the time of death, then you should look over those documents to provide for the 2010 lapse. Otherwise, you risk some of your bequests and trusts being left dry.
Interestingly, says John, an estate planning partner at a Silicon Valley firm, many states and courts are jumping in where Congress didn't. As a result, some probate courts are willing to interpret estate planning documents appropriately in the event that the 2010 lapse was ignored in the drafting. Also interestingly, John mentions that charitable giving hasn't seemed to decline as of yet, due to the estate tax mess, although he doesn't doubt that lower estate tax rates and exemptions could affect the philanthropic sector.
John seems to be taking a more cautionary approach with regards to the estate tax debacle. Rightfully so, since many of his clients are of extremely high net-worth. "We're contacting clients and informing them of the changes," he said. "Not all, but certainly the ones we think would be affected by this lapse." Of course, those clients who potentially stand to be most affected by the lapse are the elderly or the terminally ill clients -- potentially those who face a greater chance of death in 2010.
But then again, nobody can really predict death. After all, given the 2010 estate tax limbo and the tiny window of tax-free testamentary transfers, how certain are death... and taxes?
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.
Sign into your Legal Forms and Services account to manage your estate planning documents.Sign In
Create an account allows to take advantage of these benefits: