Wealth Transfer Concerns In 2012

"It's that time again"... As we have experienced in the past and most recently in 2009 and 2010, we are once again faced with the uncertainty of the estate and gift tax laws. The last time, we went through over a year of such uncertainty until the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (the "2010 Act") was signed into law on December 17, 2010 and was made retroactive to January 1, 2010. The 2010 Act extended what are typically referred to as the "Bush tax cuts" and increased the exemptions allowed for transfers of wealth both during one's lifetime and at one's death. Under the 2010 Act, the estate, gift and generation skipping transfer tax exemption increased to $5.0 million per person for 2010 and 2011 and to $5.12 million per person (as adjusted for inflation) for 2012 and the maximum estate, gift, and generation-skipping transfer tax rate was reduced to 35%.