It’s Not Too Late for a Portability Election

Posted by Robert L. Arone – New Opportunity for Late Portability Just Opened Up by IRS Portability has brought both convenience and confusion to the estate planning community. Available for surviving spouses after 2011, portability allows an unused estate tax exemption to be transferred from a deceased spouse to his or her surviving spouse. While this sounds like an appealing prospect to look into for your clients, it has come with its fair share of hassle thanks to ever-shifting policies and narrow windows of time in which to take action. Taking advantage of portability has been harder in practice than was anticipated. IRS Revenue Procedure 2017-34 Previously, surviving spouses had a mere 15 months (9 months plus a 6-month automatic extension) in which to elect portability after the death of their partner. As you know, your clients are only human: The experience of losing a spouse is always a trying

Read More »

Is There an Income Tax Time Bomb Lurking in Your Client’s Estate Plan?

Posted by Robert L. Arone – As the federal estate tax exemption has ballooned from $1.5 million ten years ago to $5.43 million today, the need for estate tax planning has drastically decreased.  Instead, higher income tax rates that were ushered in under the American Taxpayer Relief Act of 2012 (ATRA) have shifted the focus of estate planning to a new frontier:  income tax basis planning. In this issue you will learn what income tax basis is, how older estate plans have been deliberately designed to include an income tax time bomb, and the options your clients have to update their plans so that their heirs will receive the maximum basis. The Basics of Income Tax Basis In its simplest form, income tax basis is the cost to buy an asset, which includes the purchase price plus costs and transfer fees. Basis must be tracked because when an asset is

Read More »