The rest of this year promises to be very challenging for planners with wealthy clients. The federal exemptions on gift and estate taxes currently stand at $5.12 million, but they are scheduled to drop to $1 million in 2013 unless lawmakers act. In addition, President Obama's proposals for next year's budget would undermine many powerful wealth-transfer tax strategies. Planners need to be devising plans so that their clients can jump before an opportunity is lost.

There are a host of specific technical issues that are critical to address this year; in the past these may have been perceived by planners as more theoretical than real. In the simplest terms, in many client families, a couple should each establish and fund a trust today that is similar to the typical bypass trust (also called a credit shelter trust or an applicable exclusion trust) that is contained in their wills.

Register or login for access to this item and much more

All Financial Planning content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access