With the American Taxpayer Relief Act of 2012 (the “ATRA ”) passed and the fiscal cliff safely averted, the time has come to turn your attention to your estate plan.

What Did the ATRA Accomplish? The fiscal cliff threatened to reduce the estate and gift tax credit from $5 million to $1 million, and raise the maximum estate tax rate from 35% to 55%. By contrast, the ATRA:

•Set the unified estate and gift tax exemption amount at $5 million, indexed for inflation (indexed at $5,250,000 in 2013)

• Set the GST exemption at $5 million, indexed for inflation (indexed at $5,250,000 in 2013)

• Preserves portability – the ability of spouses to utilize each other’s unused exemptions – resulting in a total exemption amount of over $10 million this year for a married couple

• Permanently sets the maximum estate tax rate at 40%...

Please see full newsletter below for more information.

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Topics:  American Taxpayer Relief Act, Capital Gains, Dividends, Estate Planning, Family Trusts, Fiscal Cliff, Generation-Skipping Transfer, Gift-Tax Exemption, Grantor Retained Annuity Trust, Income Taxes, Medicare Taxes, Portability, Tax Rates

Published In: Finance & Banking Updates, Tax Updates, Wills, Trusts, & Estate Planning Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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