By Joseph L. Goldman, Esq.
The 2012 election is history. Barack Obama is still President, and the makeup of Congress and the Senate is substantially unchanged. But the estate and gift tax status is still uncertain. What’s more, time is running out on the unprecedented $5,120,000 federal estate, generation skipping and gift tax exemption available to individuals in 2012.
Unless new legislation is enacted, on January 1, 2013 the exemption is scheduled to fall to $1,000,000 per taxpayer (from $5,120,000) and the top estate tax rate is scheduled to return to 55% (instead of 35%). That would leave a married couple who has not previously used any of their exemptions with a combined available exemption of only $2,000,000 instead of $10,240,000, and a potential additional estate tax of approximately $3,500,000. With the lifetime gift exemption also to be capped at $1,000,000, opportunities to make gifts to reduce ultimate estate tax liability would also be significantly limited.
For those of you who have been waiting, for whatever reason, the time to act is now! Time is of the essence!