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Friday, March 11, 2011 Press Coverage of Estate Planning this Week (March 11, 2011)
Laura Saunders of the Wall Street Journal reports that the Administration's proposed 2012 federal budget would place limits on the length of Generation Skipping Transfer (GST) tax exemptions to 90 years. She states that chances of passage are slim, but if you are interested in creating trusts that exempt large sums from GST taxes over many generations, now may be the time to put the plan in motion. See Dynasty Trusts Under Attack (Mar. 5, 2011).
Elizabeth Ody of Bloomberg writes about another estate planning method that may become restricted in the near future. Ody writes that Grantor Retained Annuity Trusts (GRAT) have been used by some estate planning attorneys to pass investment gains from children to their parents or grandparents to allow a better quality of life in the parents’ final years. The goal is to allow the transfer without dipping into the child’s lifetime gift-tax exemption. See GRATs Let Children Pass Millions to Mom or Granny Free of U.S. Gift Taxes (Mar. 9, 2011). Monday, February 28, 2011 NEET Tips
NEET Tips answers questions posed online to the NEET website
Are there new rules in 2011 for Grantor Retained Annuity Trusts (GRAT)?
No. There was legislation in Congress during 2010 (H.R. 4849) that threatened to make GRATs less attractive in some situations, for instance by requiring minimum GRAT terms of ten years, eliminating zeroed-out GRATs, and prohibiting a declining annuity GRAT. However, none of these provisions were included in the Tax Relief Act of 2010, which passed in December 2010. Of course, Congress may revisit the issue this year or in the future. Friday, October 29, 2010 Press Coverage of Estate Planning this Week (October 29, 2010)
Paul Katzeff of Investor’s Business Daily discusses why low interest rates make grantor retained annuity trusts (GRAT) and charitable lead trusts (CLT) attractive estate planning strategies. He also discusses key differences between GRATs and CLTs, for instance GRATs are preferred for assets with high appreciation potential, while CLTs can offer upfront income tax deductions. See Estate Strategies Helped By Low Interest Rates (Oct. 22, 2010).
Chris Kennedy writes in the Visalia Times-Delta about what a fiduciary is and does. Generally, fiduciaries cover a variety of roles in which an individual serves in a position of trust by accepting responsibility for taking care of the property and/or needs of another person, for the benefit of that person. Fiduciaries can be family members or non-family professional fiduciaries, and specific roles include acting as a person’s conservator or trustee. See The Roles of the Fiduciary Are Many (Oct. 23, 2010).
Chris Barth of Forbes offers advice on organizing your affairs so that your spouse has the information necessary to run the family finances if anything should happen to you. Steps to take include: keeping a list of computer passwords and logins; listing financial and professional advisors; keeping estate plan documents up to date; and ensuring beneficiary designations are up to date. See How to Protect Your Spouse Financially After You’re Gone (Oct. 27, 2010). Friday, October 22, 2010 Press Coverage of Estate Planning this Week (October 22, 2010)
Deborah L. Jacobs of the New York Times discusses the benefits of passing your residence to your children while you are still alive. Additionally, because gift taxes might be an issue, she recommends four strategies for minimizing or avoiding gift taxes on the transfer, including giving partial interests, using a grantor trust, creating a qualified personal residence trust (QPRT), and putting real estate into an LLC or other legal entity. See Leave the Children the House, Without a Hefty Tax Bill (Oct. 20, 2010).
Anne Tergesen of the Wall Street Journal writes about grantor retained annuity trusts (GRAT) and why low interest rates and depressed real estate values make this estate planning tool particularly timely. Congress has recently discussed tightening restrictions on GRATs, providing further incentive to consider a GRAT before new laws make them less appealing. See Hurry Up and Fund That Trust (Oct. 16, 2010). Friday, October 01, 2010 Press Coverage of Estate Planning this Week (October 1, 2010)
Bob Carlson of Retirement Investing discusses issues surrounding probate avoidance, such as the disadvantages of probate in most states, but also why probate might be a good option for some assets, the differences between what constitutes your probate estate and your taxable estate, and why living trusts are often used to avoid probate. See Avoiding Probate – Or Not (Sept. 27, 2010).
Ashlea Ebeling of Forbes notes that the Applicable Federal Rate (AFR) used for various estate planning and family loans hit historically low rates in October. The AFR is used for Grantor Retained Annuity Trusts (GRAT), which allow you to pass assets to your children estate and gift tax free so long as the appreciation of the asset in the GRAT exceeds the AFR rate. October’s AFR is 2.0 percent for GRAT purposes, and as low as 0.41 percent for family loans of three years or less. See October Opportunity for GRATs and Family Loans (Sept. 27, 2010). Friday, August 27, 2010 Press Coverage of Estate Planning this Week (Aug. 27, 2010)
Deborah L. Jacobs of Forbes points out steps to take if a family member dies in 2010. Although there is no federal estate tax this year, in its place are new rules for income taxes on inherited assets, also known as the carryover basis rules. The article lists seven steps, including having assets appraised, finding cost basis records, delaying the selling of appreciated assets, and other steps to avoid costly mistakes. See Seven Steps for 2010 Heirs (Aug. 23, 2010).
Ms. Jacobs also writes about estate planning strategies known as estate freezes, which remove assets and their future appreciation from the owner’s estate and can be particularly effective during periods of low interest rates. Options include intentionally defective grantor trusts, grantor retained annuity trusts (GRAT), and charitable lead annuity trusts (CLAT), among others. See Five Ways to Freeze Out Uncle Sam (Aug. 25, 2010).
Tara Siegel Bernard of the New York Times addresses six questions regarding writing a will, including whether a will is necessary, whether it’s advisable to write your own will, and whether a revocable trust makes more sense than a will. See Getting a Will: Six Common Questions (Aug. 26, 2010). Friday, August 20, 2010 Press Coverage of Estate Planning this Week (August 20, 2010)
Seth R. Kaplan, Esq. writes in Forbes about Grantor Retained Annuity Trusts (GRAT), why GRATs are a great estate planning tool for passing money on to the next generation, and why short-term GRATs may soon be disallowed by Congress. While short-term rolling GRATs might be upended by Congressional action, mid-term and long-term GRATs are still useful, particularly when the Applicable Federal Rate (or the §7520 Rate) is low, as it is now. See The Great GRAT Debate (Aug. 18, 2010).
Joseph Nowinski, Ph.D, writes in the Huffington Post about a widower who managed to get his estate and financial affairs in order and have the necessary conversations with his children about health care directives and powers of attorney. Such conversations are not easy, but they are nevertheless important. See End of Life Planning – A Necessary Conversation (Aug. 18, 2010). Friday, June 04, 2010 Press Coverage of Estate Planning this Week (June 4, 2010)
Jerry Gleeson of RegisteredRep.com writes that tax rules for Grantor Retained Annuity Trusts (GRAT) are likely to change soon. The changes include new minimum terms of 10 years, a mandated remainder interest at the conclusion of the term, and that annuity payments may not decrease during the first 10 years of the GRAT. The proposed changes have spurred an increase in the use of GRATs before the proposed rules become law. See Rats! GRATs Benefits Could Be Axed (June 3, 2010).
Radon Stancil and Rick Parkes write in The Apex Herald (Fuquay-Varina, N.C.) about “stretch” IRAs and how by carefully managing an inherited IRA you can increase its benefits substantially. But the rules are tricky, and both the person setting up the IRA and the beneficiary have to make the right moves to make the stretch IRA work. See Maximizing Your Money Through Stretched IRAs (June 2, 2010). Friday, March 26, 2010 Press Coverage of Estate Planning this Week (Mar. 26, 2010)
Paul Sullivan of the New York Times discusses high priority estate plan documents everyone should have up to date, including a will or trust, updated beneficiary designations on insurance and retirement accounts, and advance directives, among others. See Assemble a Paper Trail, and Make Sure Your Heirs Can Follow It (Mar. 24, 2010).
Anthony J. Medico, Esq., writes in the Greenwich Citizen how to avoid common estate planning mistakes, such as a disorganized and complex probate process, failing to plan with asset protection in mind, and leaving too much to young beneficiaries who are likely to spend their entire inheritance within two years. See 10 Problems That Can Be Avoided Through Proper Estate Planning (Mar. 26, 2010).
Ashlea Eberling of Forbes updates readers on the status of Grantor Retained Annuity Trusts (GRAT), and how the law may be changing soon. Proposed legislation would require 10-year minimum terms and disallow zeroed-out GRATs. See Goodbye GRATs? (Mar. 24, 2010).
Ruth Mantell of MarketWatch writes about the importance of having a will if you have young children. The most important, and difficult, decision is who would be the children’s guardian, the person who would raise your children if something happens to both parents. Parents can make that decision, or leave it to someone else. See If You’ve Got Kids, It’s Time to Make a Will (Mar. 23, 2010). | |
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Welcome to NorthEast Estates and Trusts, PLLC (NEET). NEET assists clients with Estate Planning, Probate and Estate Administration, Special Needs Planning and Advanced Estate Planning matters in Shelburne, Vermont as well as Charlotte, South Burlington, Burlington), Hinesburg, Essex, Essex Junction, Colchester, Winooski , Cambridge, Huntington, Richmond, Williston, Jericho , Underhill , Underhill Center and Fairfax. NEET also serves clients in Chittenden County, Addison County, Washington County, Lamoille County, Franklin County and Grand Isle County.
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