Friday, September 7, 2012
I have previously blogged about how the estate tax is set to expire at the end of 2012. As a result of this uncertainty, estate planners are seeing a drastic rise in business from clients concerned that the gift-tax exemption will decrease dramatically next year.
NerdWallet recommends avoiding the rush and consulting a financial planner to create a viable financial plan. This planning can take several months to complete with valuations of assets and completion of paperwork, so it is best to see a planner as soon as possible. That way you can put your plan into action before the $5 million gift tax exemption potentially expires.
Also, remember that there are other ways to gift your estate, tax-free. Individuals can give up to $13,000 to another person per year before gift taxes kick in. Tuition or medical expenses for others are also tax-exempt if individuals pay them directly to the institution. Additionally, individuals can still make tax-free gifts to spouses and charitable organizations.
See Ashwin, I’ve Heard The Gift Tax Exemption Is Going To End Soon—Does That Mean I Should Change My Will?, NerdWallet, Aug. 24, 2012.