ESTATE TAX REPEAL OR REFORM
 
We live in an unusual period of uncertainty with respect to the law pertaining to estate and gift tax planning.  To achieve your objectives for building and preserving your personal and family wealth in this uncertain environment, you should plan your estate with great care and work with a qualified professional.
 
Some background. In 2001, Congress passed a massive tax law as part of an overall tax cutting strategy. It was the intention of the President and his Republican allies in Congress to repeal the federal estate tax entirely, thus removing what they perceived to be an unjustifiable tax on the transfer of wealth that had been previously taxed as it was being accumulated. However, the Democrats in general saw federal estate taxes as a tax on rich people who benefited most from society and were most able to contribute back to society as they passed their wealth from one generation to the next.
 
Because of differing transfer tax philosophies among members of Congress and other economic and political circumstances, the intended repeal of the federal estate tax did not occur, thus throwing the field of estate planning into an area of uncertainty. Will there be estate tax repeal? Will there be reform? Will the current law run its course and go back to its pre-2001 tax reform condition? (click here for a brief Power Point Presentation)
 
Because of the numerous proposals to repeal the estate tax, some people have stopped planning their estates, thinking that estate taxes are no longer an important issue. However, it is important not to ignore the possibility of huge transfer taxes at death or waste available credits, exclusions, and exemptions. It is also important for people to build as much flexibility as possible into their estate plans and make sure they have sufficient liquidity to pay any taxes that may be due.
 
As you consider your own situation, here are some points for you to consider:
 
•    Based upon history, when Congress repeals the estate tax, it re-institutes the tax when revenue is needed.
•    Likewise, historically low estate tax rates are increased when revenue is needed.
•    Most states assess a death tax. This will continue even if there is federal estate repeal.
•    Life insurance is a commonly accepted way to provide for payment of estate taxes because the receipt of the insurance death benefit coincides with the need to pay the tax.
•    Under the 2001 law, a repeal of estate taxes includes loss of stepped-up tax basis at death on capital gain property over a certain amount. This means that capital gain taxes may be due at death.
•    Even if death taxes are repealed, there is generally a need for income replacement and other family needs. Life insurance is traditional way to provide for these needs.
•    The tax uncertainty should not prevent you for planning for more fundamental family needs like incapacity, business succession, special needs planning, asset protection, and a beneficiary''s potential divorce and how it affects their inheritance.
 
As part of my professional due diligence, I monitor the evolving estate and gift tax laws and would like to help you and my other clients stay informed regarding these changes. Because of the numerous questions the current estate tax has raised in my clients'' minds, I will be hosting an Estate Planning Review Seminar. During this free, educational seminar I will (1) review what each estate planning documents does, (2) share some ideas which may offer opportunity for improvement based on your current family or financial situation, (3) explore the estate tax issue and how it may have positively or negative affected your estate plan, and (4) provide alternative solutions which may better fit your current estate planning objectives. Each attendee with thereafter be invited to schedule a 1 Hour Complimentary Consultation with me so we can review your personal estate plan and address any specific questions.
 
Seminar Dates:
1. Saturday, February 27, 2010 - 10:30 AM to 11:45 AM (Doors open at 10:15 AM)
2. Saturday, March 6, 2010 - 10:30 AM to 11:45 AM (Doors open at 10:15 AM)
3. Saturday, March 13, 2010 - 10:30 AM to 11:45 AM (Doors open at 10:15 AM)

Location: Barth Berus & Calderon, LLP, 333 City Blvd West, Suite 2050, Orange, CA 92868; (714) 704-4828
Click Here to RSVP. Please (1) Copy & Paste Seminar Date; and (2) indicate Number of Attendees. *Space is limited, and walkups will be admitted on a "space available" basis.

*If you cannot attend the seminar, but would like to schedule a 1 hour Complimentary Estate Plan Review with me, please click here.