In June, 2016, the House Republicans released “A Better Way: Our Vision for a Confident America”. In it, they reiterated their oft-repeated promise of repealing the federal estate tax and the generation-skipping transfer tax. However, there is no mention of a repeal of the gift tax. This is consistent with the “Death Tax Repeal Act of 2015” introduced in the House and Senate in the spring of 2015. The “Death Tax Repeal Act of 2015” provided for the repeal of estate and generation-skipping transfer taxes; however, it retained the current law with respect to the annual gift tax exclusion amount and the current lifetime exemption ($5.45 million for 2016). The maximum rate for the gift tax would be 35%. All transfers into trust would be treated as taxable gifts unless the trust was a “grantor trust”. Finally our current carryover basis rules and stepped up basis at death rules would continue to apply.
Donald Trump’s Tax Plan as related on his website (www.donaldjtrump.com/policies/tax-plan) states that he intends to repeal the estate tax with a catch. Capital gains on appreciated assets in excess of $10 million is subject to tax. (No tax rate is stated but the current highest capital gains tax rate is 20%. It seems likely that this rate would be applicable.) However, appreciation on small businesses and family farms are to be exempt from this capital gains death tax. In addition, contributions of appreciated assets to private charities established by the decedent or the decedent’s relatives would be disallowed. There is no mention of the gift tax or the generation-skipping transfer tax (this is a tax on transfers to persons more than one generation below that of the transferor and the law on it is very complex).
These plans are not entirely reconcilable. Under President-elect Trump’s plan, a 20% capital gains tax would be imposed on appreciated assets owned at death if the appreciation was in excess of $10 million and the assets in question are not family farms or small businesses. Because it would be very simple to avoid this tax by giving assets away shortly before death (and frankly, this would not be a problem for most Americans), it seems to me that his tax plan would have to address the issue of the gift tax in some fashion.
However, I would anticipate that the desire in Congress to fully repeal the estate tax and the generation skipping transfer tax (again) would likely pressure Mr. Trump to alter his plan to accommodate his fellow Republicans. After all, his plan as stated is not actually workable. The Republican vision as set forth in the “Death Tax Repeal Act of 2015” may well get worked over some more when the lawmakers actually think they have a chance to pass tax reform. The current proposal has “planning opportunities” that would make avoidance of the gift tax possible.
So, what does this mean for you? Unfortunately it means that we are likely walking into a period of uncertainty for how long these taxes may remain on the books and how they may be transformed by Congress. Given that a Republican led Congress also wants to balance the budget, it is possible that these changes may phase in over time. Should you delay making annual exclusion gifts in 2016? Absolutely not. The changes, if they come about, will not be effective before Mr. Trump takes office. Should you stay in touch with the attorneys at the Hook Law Center? Absolutely. We will analyze the changes and inform you of how they will affect you and your existing plan and whether you need to make any changes. However, since the last round of estate and gift tax reform increased the lifetime exemptions in excess of $5 million, most of you will not need to alter your current estate plans to accommodate the tax law changes. Your plans already reflect that you are not subject to the various taxes and are structured to protect your families and your non-tax related goals. For those of you who have been facing an estate or gift tax issue currently, stay tuned.
Ask Kit Kat – Learning From Bees
Hook Law Center: Kit Kat, what can you tell us about bees in northern Alaska which are helping scientists gather information about climate change?
Kit Kat: Well, I think this is fascinating. Scientists from the University of California, Riverside traveled to Prudhoe Bay, north of Fairbanks, along the Dalton Highway, made famous by the TV show “Ice Road Truckers.” They were looking for the Polaris bumblebee, known scientifically as the Bombus polaris. Increasingly as the earth’s climate warms, this particular bumblebee has migrated north into the Arctic, where climate change is happening at a fast pace. Climate change in the Arctic is evident by the fact that areas once covered only in low plants and lichens are now able to support willow trees. The expedition is being financed by a grant to foster collaboration among scientists. Six scientists participated. Their job—collect specimens and bring them back to the lab for further testing.
One of the scientists, Dr. S. Hollis Woodard, calls the bumblebee ‘…the pandas of the insect world.’ They are the largest of bees, and like the panda, they are big and move slowly. In contrast to the honeybee which tend to live in large colonies of 100,000 bees or more, the bumblebee lives in small clusters, ranging from 50 to a couple of hundred. Most bumblebee colonies live for one season, Most die as the weather turns cold. However, a few hearty females that have already mated, seek refuge under the tundra, and in essence hibernate until spring. They are the only bees which manage to survive in the Arctic, where temperatures go as low as 60 below zero. They do this by shivering their muscles. This can raise their body temperature to a toasty 95 degrees, even though the outside temperature may be at the freezing point.
There is some urgency to the scientists’ work. Just this past September of 2016, the US Fish and Wildlife Service proposed that the rusty patched bumblebee, previously very common, be considered endangered. There are 250 bumblebee species, but scientists become alarmed when even one shows signs of decline. Each bee that is captured is placed in a plastic tube, which is then given a shot of ordinary compressed air from a can available at the average grocery store. This immobilizes the bees. Then bodies and inside organs are separated and placed in a solution to preserve them. Back at the lab in California, they will conduct the examinations which will tell us more about the bees, how they survive in such adverse conditions, and possibly the implications about changing climate. (James Gorman, “Six Scientists, 1,000 Miles, One Prize: The Arctic Bumblebee,” The New York Times, Oct. 7, 2016) (http://nyti.ms/2dFqzYi)
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Hook Law Center encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Hook Law Center, P.C. If you are interested in a free subscription to the Hook Law Center News, then please telephone us at 757-399-7506, e-mail us at mail@hooklawcenter.com or fax us at 757-397-1267.The post What President-Elect Trump and the Republican Party have in Store for You: Estate, Gift and Generation Skipping Transfer Taxes first appeared on SEONewsWire.net.]]>
New York criminal defense attorney Peter E. Brill of Brill Legal Group appeared in an exclusive interview on WHDT World News with journalist Mark Maxwell about a topic that has sparked debate among the legal community. In the October 11 interview, Brill discusses the ethics and ramifications of Donald Trump’s repeated threats to jail Hillary Clinton.
Brill comments on whether there is any legal precedent for a president to launch a targeted investigation against a political opponent. Trump has claimed he will appoint a special prosecutor to investigate Clinton’s use of a private email server if he becomes president. The Republican nominee led the audience in chants of “lock her up” during his October 10 rally in Pennsylvania.
In the interview, Maxwell also asks Brill for his views on FBI Director James Comey’s decision to not prosecute the Democratic candidate in the email case and whether he thinks a special prosecutor should have been appointed from the very beginning. Brill, who is one of only two New York attorneys to be certified by the National Board of Trial Advocacy in Criminal Law, sheds light on the topic by sharing his knowledge of the inner workings of the Justice Department.
The post Peter Brill weighs in on Trump’s threat to jail Hillary Clinton first appeared on SEONewsWire.net.]]>While these estate tax rates have stayed fairly consistent over the past few years, Oakland County estate tax attorneys have recently been asked by their clients how they think the 2016 Presidential election may affect the federal tax limits. By and large, the answer all depends on who gets elected to the White House, as the political parties and presidential candidates have differing views on what should be done with the estate tax.
The Democratic candidates, through proposals and past actions, are against lowering estate tax limits. Hillary Clinton has a track record of voting against raising the federal gift tax exemptions – in 2006 she voted against raising the exemption to $5 million, and in 2007 she voted against repealing “death taxes.” While she has no specific proposal in place for changing the federal estate tax exemptions, her voting record gives some insight into which direction she may go if elected President. Bernie Sanders, on the other hand, actually does have a proposal in place for what he calls a “Responsible” estate tax, which includes a $3.65 million limit and a 65% top estate tax rate.
The Republican field, by and large, are in favor of either lowering the estate tax limits or abolishing the estate tax altogether. Front runner Donald Trump, along with Jeb Bush, Rand Paul, Marco Rubio, and Mike Huckabee, have all proposed either eliminating the federal estate tax or letting individual states decide whether or not they want to collect estate taxes. John Kasich and Carly Fiorina have not put forth any specific proposals for how they would approach the estate tax, but Kasich eliminated the estate tax in Ohio during his time as governor.
No matter who is elected President, it’s important to note that he or she does not actually have the power to eliminate the estate tax, since Congress is the branch of government that controls taxes. This past year, the Republican controlled House of Representatives voted overwhelmingly to repeal the estate tax, while the Senate may vote on its own repeal bill next year. That being said, whoever is elected President will have the ability to either veto or sign into law whatever changes are made by Congress to the federal estate tax.
No matter who wins the 2016 election, Oakland County estate tax attorneys are expecting big changes to come to the federal estate tax limits. If you have any questions about how the federal estate tax exemptions can affect you, or if you qualify for an exemption from state estate taxes, please contact us at (888) 390-4360.
The post Oakland County Estate Tax Attorney: The Future of the Federal Estate Tax appeared first on The Elder Care Firm.
The post Oakland County Estate Tax Attorney: The Future of the Federal Estate Tax first appeared on SEONewsWire.net.]]>While these estate tax rates have stayed fairly consistent over the past few years, Oakland County estate tax attorneys have recently been asked by their clients how they think the 2016 Presidential election may affect the federal tax limits. By and large, the answer all depends on who gets elected to the White House, as the political parties and presidential candidates have differing views on what should be done with the estate tax.
The Democratic candidates, through proposals and past actions, are against lowering estate tax limits. Hillary Clinton has a track record of voting against raising the federal gift tax exemptions – in 2006 she voted against raising the exemption to $5 million, and in 2007 she voted against repealing “death taxes.” While she has no specific proposal in place for changing the federal estate tax exemptions, her voting record gives some insight into which direction she may go if elected President. Bernie Sanders, on the other hand, actually does have a proposal in place for what he calls a “Responsible” estate tax, which includes a $3.65 million limit and a 65% top estate tax rate.
The Republican field, by and large, are in favor of either lowering the estate tax limits or abolishing the estate tax altogether. Front runner Donald Trump, along with Jeb Bush, Rand Paul, Marco Rubio, and Mike Huckabee, have all proposed either eliminating the federal estate tax or letting individual states decide whether or not they want to collect estate taxes. John Kasich and Carly Fiorina have not put forth any specific proposals for how they would approach the estate tax, but Kasich eliminated the estate tax in Ohio during his time as governor.
No matter who is elected President, it’s important to note that he or she does not actually have the power to eliminate the estate tax, since Congress is the branch of government that controls taxes. This past year, the Republican controlled House of Representatives voted overwhelmingly to repeal the estate tax, while the Senate may vote on its own repeal bill next year. That being said, whoever is elected President will have the ability to either veto or sign into law whatever changes are made by Congress to the federal estate tax.
No matter who wins the 2016 election, Oakland County estate tax attorneys are expecting big changes to come to the federal estate tax limits. If you have any questions about how the federal estate tax exemptions can affect you, or if you qualify for an exemption from state estate taxes, please contact us at (888) 390-4360.
The post Oakland County Estate Tax Attorney: The Future of the Federal Estate Tax appeared first on The Elder Care Firm.
The post Oakland County Estate Tax Attorney: The Future of the Federal Estate Tax first appeared on SEONewsWire.net.]]>