A Unique Opportunity from the 2010 Tax Relief Act
On December 17, 2010, President Obama signed the 2010 Tax Relief Act, extending the Bush-era tax cuts. With this new law in place, there is an once-in-a-lifetime planning opportunity that ends at the stroke of midnight on December 31st.
Generally, any transfers greater than $13,000 per year to generations younger than children are subject to the generation-skipping tax. The purpose of this tax is to prevent wealthy individuals from transferring assets to younger generations for the purpose of avoiding application of the estate tax at every generation. However, gifts made through December 31, 2010 will not be subject to the generation-skipping transfer tax due to the passage of the new law. Beginning January 1, 2011, this tax rate will increase to 35% and return to 55% in two years.
For more information on taking advantage of this once-in-a-lifetime planning opportunity, please contact Wood, Atter & Wolf, P.A., in Jacksonville and Ponte Vedra Beach, Florida.
