Oscar Wilde wrote, in The Picture of Dorian Gray: "Knowledge would be fatal, it is the uncertainty that charms one. A mist makes things beautiful."
If I should run into Oscar Wilde (I won't - he died in 1900), I would have a few words with him. I have had quite enough of uncertainty and mist, and I am sure you have, also.
When I heard the forecast of Hurricane Earl, I secured the desk furniture. Some people boarded up windows and others left Chatham.
We suffered some erosion and no serious damage, otherwise. We went through a lot of effort because of the uncertainty of the forecast. I think I will take certainty any time.
We have uncertainty in estate planning because of the failure of Congress to decide the future of the estate tax. The tax is suspended. On January 1 it will return to what it was in 2001, with an exemption of $1,000,000 per estate and a top rate on the excess of 55%.
Congress is expected to vote to return the tax to what it was in 2009, with an exemption of $3,500,000 per estate and a top rate on the excess of 45%. If and when this will happen, and whether Congress will try to make it retroactive, is uncertain.
Estate planning under these circumstances is somewhat like trying to nail JELL-O to a tree. However, there are some things we do know.
Whatever Congress does, if your trust and wills were up-to-date in 2009, it is likely that your estate plan will still work well in 2011. However, you should have us review them to be sure.
If someone with an estate plan that was appropriate in 2009 dies before the end of 2010, the result could be unfortunate, since the estate plan probably refers to the tax in effect in 2009. Because of this, you should amend your trust and will to cover the period from now until 2011, or Congress acts, if that occurs earlier.
If you and your spouse have more than $2,00,000, or you have more than $1,00,000 if you are single, and you want to review tax-saving devices including gifts, family limited partnerships, and limited liability corporations, contact us as soon as possible.
