November 12, 2012
And Its Gone, Experts Predict That Lifetime Gift and Estate Tax Exemption Will Expire
Following the re-election of President Barack Obama, it has now come time to address the issue of what his administration and the new Congress will do with the lifetime gift and estate tax exemption. President Obama has previously suggested that he would like the new lifetime exemption to be set at $3.5 million with a tax rate of 45% on income that exceeds the exemption. While it is still uncertain on how President Obama or the new Congress will act, it is likely that the $5.12 million lifetime exemption will expire at the end of the year. That is why every couple or individual with more than $2 million in asserts might want to strongly consider taking advantage of this once in a lifetime offer. As I have previously discussed, married couples can make gifts upwards of $10.24 million tax-free. In addition, this is an excellent opportunity to transfer property that is likely to appreciate in value. The appreciated value of property will pass under the lifetime gift and estate tax exemption without incurring a tax. Finally, for those who are concerned with gifting large amounts of property, the person making the gift can still "impose conditions and controls so gifts aren't squandered."
See Robert W. Wood, Grab the $5M Gift and Estate Tax Perk: It's Gone In 2013, Forbes, Nov. 10, 2012.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
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