It’s “New Year’s Resolution” time and I suggest that you add TAX PLANNING to your list … shouldn’t it always be on the list?

On December 22, 2017, the TCJA enacted the most sweeping tax legislation since the Tax Reform Act of 1986 making changes to tax rates, tax brackets, tax deductions, tax exemptions and offering new opportunities for pass-through entities with tax planning.

Gift and Estate Tax in 2019

These changes affect your tax planning and the decisions you will need to make with your Personal Board of Directors.  If you do not have a Personal Board of Directors (CPA, Attorney, Financial Advisor, etc.), then contact us to help you create one.

One of the most prominent changes is an increase in the amount you may transfer without incurring Gift Tax or Estate Tax.

  • Every Year:
    • You can give up to $15,000 per person per year without any gift tax; and
  • Once in a Lifetime:
    • Additionally, you can use all or part of your “Lifetime” gift and estate tax exemption which has increased to $11,400,000 for advanced estate tax planning.

2019 Review

Your estate planning documents should be reviewed for 2019 Standards and may need to be updated for these higher exemption amounts to avoid any surprises and properly reflect your intentions.   Use of a “Credit Shelter Trust” (aka “Bypass Trust”, “B Trust”, “Family Trust”) in Wills and Living Trusts may no longer be necessary or suggested.

Finally, many clients are now utilizing a “Family LLC” (limited liability company) to protect their assets from lawsuits / creditors’ claims and facilitate gifting to family members while still maintaining a high degree of control. 

Contact our office for help in any of these areas.   

Happy New Year!

By:   Ken Vanway.    January 7, 2019