Here are some suggestions while we wait for clarity. Let the Tax Tail Wag the Dog Taxes are important, but the needs of your family and beneficiaries should be paramount. If you have not completed or updated your estate plan, don t use this period of uncertainty as a reason for further delay. Even under the best of circumstances, the estate tax will be with us for 10 years. At this point, individuals should continue their gift, life insurance, charitable and other planning programs.
Some decisions are more difficult.
The purchase of a new life insurance policy to cover death tax upon the death of a husband and wife becomes a more difficult choice with the potential for tax repeal. On the other hand, even the Republican proposal shifts the tax burden from an estate to an income tax so that there still remains a likely tax burden following death. Thus, liquidity will remain an issue. Planning Planning should focus on strategies that minimize the risk of payment of a gift tax. Annual exclusion gifts are totally excluded from estate and gift taxes.