“We just celebrated the 100th anniversary of the estate tax. It has already been repealed and reinstated four times. This would be the 5th.” observes Susan Rounds, JD, CPA in the Journal of Estate & Tax Planning., referring to the many proposed tax law changes under the new administration, including a possible repeal next year of the estate tax. “We must help clients plan for all contingencies – so no matter which turn is taken, the path is clear,” she adds.
No matter which path is chosen, repeal or no repeal, wealth in motion will be taxed, Rounds reminds readers. Even were the estate tax to be repealed, a capital gains tax increase would probably ensue. “For those clients who have not initiated the planning process, let’s get started. For those who have a plan in place, let’s review what they have,” Rounds tells fellow practitioners.
At Geyer Law, we certainly agree with that advice. There are many estate planning pitfalls to avoid that have nothing to do with estate taxes. As we explain on our website, “Life’s journey is fraught with change – marriage, children, a new business, retirement, incapacity, death. These changes require careful planning to protect the people most important to you and the assets you worked a lifetime to achieve.”
One example might be planning for jointly held property when there is a concern that the survivor might squander, give away, or lose the property to creditors, leaving the executor of the decedent with a lack of adequate cash to pay settlement expenses. A well drawn estate plan can ensure a better outcome for everyone involved.
LifeHealthPRO offers a very good definition of estate planning, we believe:
Estate planning is the process of planning the accumulation, conservation,
and distribution of an estate in the manner that most efficiently and effectively
accomplishes your personal tax and nontax objectives.”
Possible changes in estate tax law means there is a need for estate planning flexibility, and estate planning itself is more important than ever!