In This Issue:

Year-End Tax Planning -

Year-end planning is a bigger challenge this year than in past years because, unless Congress acts, tax rates will go up next year, many more individuals will be snared by the alternative minimum tax (AMT), and various deductions and other tax breaks will be unavailable. To be more specific, as a result of expiring Bush-era tax cuts, individuals will face higher tax rates next year on their income, including capital gains and dividends, and estate tax rates will be higher as well. The AMT problem arises because, for 2012, AMT exemptions have dropped and fewer personal credits can be used to offset the AMT. Additionally, a number of tax provisions expired at the end of 2011 or will expire at the end of 2012. Rules that expired at the end of 2011 include, for example, the research credit for businesses, the election to take an itemized deduction for State and local general sales taxes instead of the itemized deduction permitted for State and local income taxes, and the above-the-line deduction for qualified tuition expenses. Rules that will expire at the end of this year include generous bonus depreciation allowances and expensing allowances for business, and expanded tax credits for higher education costs...

Planning and Paying for Long-Term Care -

In Part 4, I explained that some assets are counted for Medical Assistance eligibility – and other assets are “exempt” or not counted. Recall that exempt assets include one’s principal residence, one motor vehicle, household furnishings, and a spouse’s retirement accounts. Countable assets include bank accounts, CD’s, most types of investments (stocks, bonds, mutual funds, etc.), most types of annuities, and cash value in life insurance policies...

Should You Be Considering Year-End Gifts? -

A variety of favorable tax laws are set to expire at the end of 2012. A notable example of an expiring tax law is the $5,120,000 per person exemption amount for lifetime gifts...

Please see full issue below for more information.

LOADING PDF: If there are any problems, click here to download the file.