Estate Planning In An Uncertain Environment
April 2, 2012A few years ago, I was working with a client, a retired executive, to update his estate plan. Like most retirees, he enjoyed playing golf and spending time with family and friends much more than working through his estate plan. His aversion was magnified because he just wasn’t comfortable with the important decisions that had to be made. We’d talk on the phone about the next steps; he’d meet with …
Tax Changes In 2012
April 2, 2012
As you complete your 2011 tax return checklist, you may not have considered the last step: thinking about your 2012 taxes. Avoid the temptation to ignore taxes until this time next year. The good news is that most taxpayers will be affected only by a few small changes for 2012. However, many tax provisions are set to expire at the end of the year, which makes it an important one …
No Interest In Foreign Accounts
November 3, 2011The IRS has been aggressive recently in pursuing tax cheats who have hidden assets in offshore accounts. Penalties for not reporting the existence of foreign accounts are steep, which concerns even honest businesses and individuals that are unsure about their filing obligations. Generally, U.S. taxpayers with a financial interest in foreign financial accounts are required to file Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (often referred …
Capital Gains Planning Strategies
October 10, 2011Capital gains tax rates are at historic lows, but they are in the political crosshairs. It’s a good idea to take advantage of planning strategies now. Capital gains contribute to a taxpayer’s adjusted gross income. An investor realizes capital gains when he sells investments for more than he paid for them; capital losses are the opposite. All of an investor’s capital gains and capital losses are first combined to create …
Avoiding The Partnership Technical Termination Trap
October 10, 2011Some families have been pleased about using partnership interests for wealth transfer during the recent market lows. Unfortunately, a few have been met with unwelcome surprises — five-figure bills penalizing the partnerships for filing late tax returns. When a partnership is terminated, its final income tax return is due three and a half months from the date of termination. Unless the partnership happened to cease doing business on Dec. 31, …
Tips On Surviving A Tax Audit
March 29, 2011I had just left our Scarsdale, N.Y., headquarters on a business trip a couple of years ago when an Internal Revenue Service collections officer named Celeste Green stormed in, waving a “Notice of Intent to Levy” and demanding that we pay the IRS $25,000 by the end of that month. Since I was not present, Green directed her brusque comments to our perplexed receptionist, who knew nothing about our business …
Here Is What Happens If You Are Audited
March 29, 2011Being well informed is the best way to ease the anxiety that comes with a letter from the Internal Revenue Service notifying you of a tax audit. First, know your rights, spelled out in the IRS publication “Your Rights as a Taxpayer.” Those include the right to privacy and confidentiality, to professional and courteous service, to be represented by your accountant or other tax professional, to get help with unresolved …
2011 Tax Changes: Facts, Opportunities And Lessons
March 9, 2011Amid widespread concern about 2011 tax increases, Congress surprised taxpayers in late December by actually reducing taxes for the next two years. What should a prudent person do now, and what can we learn from the evolving tax legislation? While income tax changes for 2011 do not ultimately have much impact on high-net-worth taxpayers, new transfer tax rules have the potential to dramatically reduce their tax burdens. Gift And Estate …
Don’t Let A ‘Crummey’ Mistake Ruin Your Trust
June 4, 2010Imagine paying your attorney a small fortune to draft your trust documents, only to have the Internal Revenue Service attack your gifting plan to the trust years later. Some taxpayers find themselves in this unfortunate situation when it comes to the common, yet often mishandled, area of Crummey withdrawal powers. What Are Crummey Powers? Many estate plans call for annual gifts to heirs, often through trusts. To be eligible for …
Onerous New State Tax Rules
February 1, 2010Oregon shed its fierce anti-tax reputation last month by doing something rarely seen — it voted for higher taxes. Facing a budget deficit of more than $700 million, Oregonians passed two proposals that tied them with Hawaii for the highest personal income tax rate in the nation and gave them the highest capital gains tax and corporate minimum tax. Oregon’s plight was not unique, although most states have not left …
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