Time to Focus on Family Wealth Succession Planning

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Tax law seems more uncertain than ever; however, what is a sure thing is the importance of CPAs and other professionals moving their clients to update and improve their succession planning.


The Tax Relief Act of 2010 (enacted 12/17/10) gives CPAs and other tax professionals an outstanding “window of opportunity” for 2011 and 2012 (the law sunsets January 1, 2013, absent additional tax legislation).


The new $5 million lifetime gift tax exemption gives families a real opportunity to shift values of investment assets and family businesses to younger generations – all without any gift tax and with the opportunity for future income and appreciation to go to the younger generation family members. Outright gifts, installment sales, self-cancelling installment sales, sales to grantor trusts are among the techniques worthy of consideration.  It is important, also, to review existing estate plans, especially where there are “formula clauses” that are impacted by changes in exemption levels.


According to CPE Link author-instructor Owen Fiore, JD, 2011-2012 is a critical time period for really getting the family wealth succession planning job done right and with the necessary flexibility. Now is the time for action, before Congress either fails to act or acts in a manner adverse to wealth accumulation and preservation important to our clients. Especially as to valuation discounts and the use of entities to shift wealth within the family, timing is essential due to the possibility of adverse tax legislation at any time, even before 2013.


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