Pending Legislation Could Substantially Modify Estate and Gift Tax Laws
To our client and friends:
I hope that each of you is staying well through the pandemic and that we continue to press forward into better times. The purpose of this note is to provide you with an important alert regarding proposed legislation that is likely to pass in some form at least in part, and if passed, will drastically modify the existing estate, gift, and generation skipping tax laws. The effective date of the legislation is not yet known, but under various proposals, the effective date may be the date of enactment of the legislation in some cases and January 1, 2022 or some other date in other cases. Due to the real possibility that at least part of the legislation will be effective upon enactment, we at Keating Muething & Klekamp PLL feel that it is important to bring this to your attention right away in order for you to be proactive with your planning.
The changes could significantly reduce the amount that an individual may transfer to family members free of a transfer tax and could create estate or gift taxes for individuals where such taxes would not have been imposed previously. Various estate planning opportunities which have become standard over many years may in fact be materially changed. The proposals include, among other items, significant changes to the estate and gift tax laws which may substantially curtail the use or effectiveness of irrevocable life insurance trusts, grantor retained annuity trusts, gifts of family business interests and other lifetime transfers. As noted, if passed, some or all of these changes may become law on the date enacted.
Proper planning in advance of enactment is therefore important. We look forward to answering your questions and assisting you in navigating these changes. We encourage you to reach out to any of our attorneys in our Private Client Group listed below or to your KMK Law relationship attorney as soon as possible to discuss how these legislative proposals may impact you and to proactively implement changes as needed.
As always, thank you for being a valuable client and friend of KMK Law.
Very truly yours,
Alan S. Fershtman