In this comment, David A. Krueger addresses the issue of estate tax law based on the “Tax Cuts and Jobs Act” (TCJA).
In the first article of his series of Instructional Articles, Colorado & Texas Estate Planner David A. Krueger addresses the issue of estate law tax pursuant to the Tax Cuts and Jobs Act (TCJA).
To summarize the law, “The Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, Pub.L. 115–97, is a congressional revenue act originally introduced in Congress as the Tax Cuts and Jobs Act (TCJA), that amended the Internal Revenue Code of 1986. Major elements of the changes include reducing tax rates for businesses and individuals; a personal tax simplification by increasing the standard deduction and family tax credits, but eliminating personal exemptions and making it less beneficial to itemize deductions; limiting deductions for state and local income taxes (SALT) and property taxes; further limiting the mortgage interest deduction; reducing the alternative minimum tax for individuals and eliminating it for corporations; reducing the number of estates impacted by the estate tax …. For deaths occurring between 2018 and 2025, estates that exceed $11.2 million are subject to a 40% estate tax at time of death, increased from $5.6 million previously. For a married couple aggregating their exemptions, an estate exceeding $22.4 million are subject to a 40% estate tax at time of death …” (Wikipedia, https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act_of_2017#Estate_tax, footnotes omitted)
Experienced estate planner David Krueger discusses the role of estate planning in light of recent changes to Federal tax law. One of the biggest changes to the existing law is the temporary rise of the individual estate and gift tax exemption to $11.2 million until 2025. The change, implemented by the “Tax Cuts and Jobs Act” (TCJA), represents a substantial increase from the previous exemption limit.
The continuing rise of the individual exemption in recent years and the transferability of the exemption between spouses means that only a very small segment of the population will need advance planning to save on Federal estate taxes. “This does not diminish the importance of other aspects of estate planning”, notes Mr. Krueger. “For example, a comprehensive estate plan would not only address how properties should be distributed upon death but also provide for unexpected events such as incapacity and disability. Without advance planning in place, such unfortunate event may necessitate a court proceeding for guardianship or conservatorship to settle the myriad of issues that may arise in such situations. A good estate plan will deal with many different possible contingencies and try to ensure that there is a plan in place that reflects the wishes of the individual creating the plan in each situation.”
Mr. Krueger goes on to explain that it is important to periodically review these estate plans with a qualified attorney. Major changes to applicable laws, regulations, or new court decisions can all have enormous impact on an individual’s estate plan. The best way to ensure that your plans are consistent with your wishes is to be diligent and regularly review them with a qualified attorney. Everything from changes in legal landscape to changes in circumstances may require periodic updates to an individual’s estate plans.
For example, some estate plans may provide that grandchildren get assets equal to the maximum allowable under the exemption to the generational skipping tax. When the exemption was low, such planning was done to ensure that some portion of the estate would go tax free to the grandchildren by utilizing the exemption. With a substantial increase in generational skipping tax exemption under the TCJA, such planning language would need updating and could otherwise wreak havoc with the original intent of the testator or trustor. These types of unintended consequences that may result from a change in law shows the need for ongoing review and update to estate plans.
The full instructional article is published on the Blog of Mr. Krueger at https://DavidKruegerBlog.blogspot.com
The blog includes advice gained from David Krueger’s 18 years of experience in tax & estate planning
Colorado Springs, Colorado, August 2018 – David A. Krueger, a respected Tax planner in Colorado and Texas, announced today his new legal blog https://DavidKruegerBlog.blogspot.com/ which will focus primarily on complex legal issues in Tax & Estate Planning and ways to optimize taxation of assets.
David A. Krueger has launched this blog that will provide legal commentary and analysis of complex tax and estate issues as a service to the public. “With all the tax news information circulating, especially since the Trump administration’s tax measures in the Fall of 2017, I felt that I could help explain the facts underlying the discussions, and help families, individuals and companies plan their taxes and assets more efficiently,” said David A. Krueger. “As a tax and estate practitioner, I am sharing the experience I have gained in over 18 years of solving complex problems not only for individuals but for businesses as well,” David Krueger added.
The Blog features legal analysis and commentary on significant court precedents, as well as regulatory developments. It will also include commentary on recent legal and regulatory developments.
Mr. Krueger prides himself in being a guide and supporter of families as well as business owners and managers to make positive and sustainable changes in their tax planning. He has assisted many businesses in strategic planning and problem-solving to support growth with increased profits.
About David A. Krueger
David Krueger is a Tax Planning Advisor in Texas and Colorado at Oakbrook Estate Services. His practice areas include:
· Estate Planning and Family Wealth Preservation Planning
· Income Tax Planning
· Business Succession Planning
· Asset Protection Planning
· Estate and Trust Administration
· Probate Administration
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