Bronx

Extensive trust-planning and maneuvering tax law in order to protect a surviving spouse has long been a central part of the job of any qualified New York City Estate Planning Lawyer. Almost as soon as the United States Government christened the estate tax, wealthy families began finding ways around paying. Of central concern for many married couples is how to avoid the estate tax long enough that if one partner in the marriage dies, the other partner’s assets are protected, and any shared wealth is not taxed.

One of the most time-trusted methods of escaping the estate tax is a bypass trust- known more familiarly as a “family trust”. This trust is typically used to set up a trust-fund. The money which is set aside in a trust fund or other tax sheltered annuity (another common example is a charitable trust), is not taxable by the government. The surviving spouse can continue to live on whatever interest the fund might bear. In some cases, he or she can actually use a small percentage of the principal as well. Lawyers in Brooklyn and The Bronx are constantly trying to improve their handling of these problems.

According to the New York Estate Planning Lawyer we spoke with, the new tax law enacted at the end of 2010 could spell good news for married couples trying to plan their estate. By significantly raising the exemption and making those exemptions portable (in other words, transferable from one spouse to another in the event of death), the federal government has given couples the option of leaving funds directly to one another, without going through a trust or other tax shelter.

The Estate Planning community is in a buzz over a new tax law approved by president Obama in late December of 2010. The Tax Relief, Unemployment Reauthorization, and Job Creation Act of 2010, or TRA 2010 for short, is a “game-changer,” one New York Estate Planning Lawyer is saying. In the past, the entire estate planning business revolved around estate taxes, and how those taxes were applied. In light of the new law, these taxes represent a much smaller hurdle to the industry at large. Lawyers in The Bronx and Staten Island are very aware that laws can change at any time.

If you are a New York Estate Planning Lawyer, and are considering giving your congressional representative a thank-you call, you are certainly not alone; but I would caution you to first read the fine print of the law. While no law is ever completely permanent, this law comes with an expiration date. After two years, the law is slated for review. If it is not reviewed and reinstated at that point, then estate tax law will effectively be reset to the levels present before the law was enacted.

On the other side of the equation, one New York Estate Planning Lawyer claims that this new law sounds the death knell for the Estate Tax in general. He contends that under the New TRA law, the value of collectible Estate Taxes is now so small as to be almost negligible, and would be a waste of IRS manpower to even bother to collect. Only time will tell whether the new law will act as a temporary tax relief mechanism, or as a stepping stone to Estate Tax repeal.

Articles Posted in Bronx

New Estate Tax Law Alters Estate Decisions

New Tax Law Changes the Game