Tuesday, May 18, 2010

2010 Estate Tax Repeal Is Not A Big Deal

Every year that I have been in practice there have been changes to the Estate Tax.  This year would seem to be the biggest change with the temporary repeal of the Estate Tax.  However, all the comments from Washington confirm that a new Estate Tax will be in place soon and it will likely include an individual exemption in the $3 million range, which is basically what we had last year.

Some advisors are raising concerns about the capital gains rules that are in effect until a new Estate Tax is passed and suggest that some additional planning may be in order.  This is not necessary for most people as the existing rules allow a $4.3 million exemption for capital gains assets passing to a surviving spouse.  And these rules are only in effect until Congress passes a new Estate Tax which may be only a few more months.

If you, or a relative, are seriously ill and have a large estate, it certainly would not hurt to review your Estate Plan to see if the repealed Estate Tax provides any opportunities.  The vast majority of people should wait until the new Estate Tax is passed and then consult with their advisors.