Year-end is always hectic but it’s well worth taking the time to consider a few investment moves that could have positive tax ramifications.
Our ever changing tax laws seem perpetually riddled with sunset clauses. And that makes estate planning opportunities fleeting. For instance the Tax Relief Unemployment Insurance Reauthorization and Job Creation Act of 2010 (TRA) increased the federal gift tax exclusion to $5 million.
In an effort to ensure everyone pays their fair share of taxes on January 1st of this year the Federal government began requiring brokerage firms and other custodians to calculate and report gains or losses on certain customer trades to the IRS.
The USA Today did a series of articles on insurance on Friday March 25th and I was a contributer to the article as noted below.  And WTOP Radio also called me at 6:50 AM this morning and asked a few questions about last minute tax planning ideas.
Perhaps lost in all the posturing about what would become of the Bush tax cuts was a valuable extension for qualified charitable distributions. The 2010 Tax Relief Act extended the tax-free distributions from Individual Retirement Accounts (IRAs) for charitable purposes through 2011 i.e. Qualified Charitable Distributions (QCDs).
Although agreement seemed highly unlikely just weeks ago Democratic support for a plan put forward by Republicans and accepted by President Obama seems to be gaining steam. The compromise in waiting would reinstate the estate tax at 35% for two years starting next year with the first $5 million of an individual’s estate exempted.
Ben Franklin famously quipped that the only certainties in life were death and taxes. Of course with the Bush tax cuts scheduled to sunset at the end of the year and the midterm elections capable of changing the balance of power on Capitol Hill there is nothing certain about future tax policy.
It is an interesting time in our nation’s capital. The latest polls show that the Republican Party may gain more than the 39 seats necessary to tip the balance of power their way in the House.
The recent death of two billionaires has thrust back into the spotlight the fact that Congress let the federal estate tax expire .
Legislators in Congress are reportedly considering creating a kind of Roth IRA version of the estate tax. “On The Money” a blog of the congressional newspaper The Hill recently reported that lawmakers are debating whether to let taxpayers opt to pay estate taxes in advance so their heirs owe nothing.