Possible Changes to Gift and Estate Tax Laws:
Rumors abound as to what the Super Committee will recommend for the estate and gift tax, if anything. And at this point no one knows what the future holds in this area. That said, we do know that the deadline for the Super Committee’s proposal, November 23, 2011, is rapidly approaching.
IF the Super Committee makes a proposal, Congress will then have 30 days to pass the proposal as is, with only a simple majority vote required in both chambers to pass it. Thus, there is a chance that the gift and estate tax laws could change as early as a few days from November 23rd. Alternatively, if no Super Committee proposal is passed there will be automatic cuts totaling $1.2 trillion, including cuts to defense spending and Medicare.
What does this mean for our clients? A Special Report just issued from Trusts & Estates magazine explores some of the possible Super Committee recommendations and suggests three possible courses of action for clients today:
o Accelerate use of the $5 million gift tax exemption, particularly those that leverage our historically low interest rates;
o Accelerate implementation of leverage strategies like GRATs, installment sales to grantor trusts, FLPs and FLLCs;
o Review of current estate plans.
The full article is available online at http://trustsandestates.com/wealth_watch/super-committee-proposals-estate-gift-tax-1110/.