NEW YORK, Nov. 7, 2012 - In response to the results of the 2012 election, John O. McManus – top AV-rated tax and estate planning attorney and founding principal of Tri-State-Area-based McManus & Associates – released the following guide to changes in tax rates and exemptions, as well as a statement below:
2012 and 2013 Tax Rates and Exemptions
Estate Tax Rate
Estate Tax Exemption
Gift Tax Rate
Gift Tax Exemption
Generation Skipping Transfer Tax Rate
Generation Skipping Transfer Tax Exemption
From John O. McManus:
"What does President Obama winning re-election mean for estate planning? Answer: Certain estate planning strategies are set to expire with no expectation that they will be extended. We must get to work now while we still have the opportunity. The gift tax exemption, currently allowing individuals to transfer up to $5,120,000 in assets free of tax retreats to $1,000,000 at the end of this year, and the gift tax rate jumps from 35% to 55%.
"As we hurl toward the fiscal cliff of 2013, Speaker Boehner and President Obama now draw lines in the sand assuring an end to this unique tax opportunity. Furthermore, if and when a compromise is achieved – possibly sometime next year – the death tax and gift tax rates will likely increase significantly, and the tax benefits will fall to less than 20% of what is available through year-end.
"More than ever, it is now critical to hop on this last tax-planning train before this period dissolves to the disadvantage of loved ones.
"Rather than giving gifts directly to loved ones, transfers should be made into trust to provide flexibility, control and access to the donor. Assets such as business interests, private equity ownership, stock portfolios, cash and real estate are all suitable for transfer. Employing qualified professionals can assure that this work can be completed in less than 30 days – just enough time to make the deadline. Missing this twilight period could prove to be taxing on your mind and your balance sheet."
Visit www.mcmanuslegal.com to learn how to take advantage of this fast-closing window of time as the end of 2012 approaches.
About McManus & Associates
McManus & Associates, a trusts and estates law firm, was formed in 1991 by John O. McManus to provide the high quality experience of the largest firms coupled with the intimacy and efficiency of a specialized boutique firm. Over 20 years later, McManus & Associates continues to earn its reputation for integrity, intellectual ability, efficiency, and enduring relationships.
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SOURCE McManus & Associates