Personal Planning Strategies - March 2011

THE 2010 TAX ACT – WHAT IT MEANS FOR YOUR CURRENT WILL/REVOCABLE TRUST AND ESTATE PLAN

As we previously reported, The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (the "2010 Act") made significant changes to the estate, gift and generation-skipping transfer ("GST") tax regimes. 

Increased Exemptions

Under the 2010 Act, each of the federal estate tax, GST tax and lifetime gift tax exemptions has been increased to $5 million as follows:

• In 2011 and 2012, there is a $5 million federal estate tax exemption (increased from $3.5 million in 2009) and a 35% top estate tax rate (decreased from 45% in 2009). 
• In 2011 and 2012, there is a $5 million GST tax exemption (increased from $3.5 million in 2009) and a 35% top GST tax rate (decreased from 45% in 2009).