As a service to our clients and friends, we have prepared a summary of planning opportunities that should be considered prior to the end of the year.
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Once again, there is tremendous uncertainty regarding the tax rules that will be applicable in 2013. Although we now know who will be president for the next four years, we do not know whether President Obama and Congress will be able to reach a consensus prior to year-end to avoid, or at least minimize, the impact of the expiration of the Bush-era tax cuts. Existing provisions are set to expire on December 31. |
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While both sides are talking about trying to work together and compromise on the long-term tax on budgetary issues, the sides remain far apart on actual policy proposals.
Even so, there are distinct estate and tax planing options that can be taken advantage of before year end. The most time sensitive items involve the ability to use the $5,120,000 gift tax exclusion and GST exemption.
Without new legislation, the following tax rates will apply:
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2012 law |
2013 law |
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| Top ordinary income rate (wages) |
35% |
40.5% |
| Top capital gains rate |
15% |
23.8% |
| Tax rate on dividends |
15% |
43.4% |
| Tax rate on interest, rent, royalties and other passive ordinary income |
35% |
43.4% |
| Estate/gift/GST tax exemption amount |
$5,120,000 |
$1,000,000 (estate & gift) $1,430,000 (GST – est.) |
| Estate/gift/TST tax rate |
$35% |
55% |
Read the entire newsletter: Year-End Update at a Glance: Post-Election Summary (November 2012)
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Although this review is necessarily general in nature, Gunster’s private wealth services attorneys are happy to discuss any item of specific interest in more detail with you.
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This publication is for general information only. It is not legal advice, and legal counsel should be contacted before any action is taken that might be influenced by this publication. Established in 1925, Gunster is one of Florida’s oldest and largest full-service law firms. The firm’s clients include international, national and local businesses, institutions, local governments and prominent individuals. Gunster maintains its presence in Florida with offices in Fort Lauderdale, Jacksonville, Miami, Palm Beach, Stuart, Tallahassee, Tampa, The Florida Keys, Vero Beach and its headquarters in West Palm Beach. Gunster is home to more than 165 attorneys and 200 committed support staff, providing counsel to clients through 18 practice groups including banking & financial services; business litigation; construction; corporate; environmental & land use; government affairs; health care; immigration; international; labor & employment; leisure & resorts; private wealth services; probate, trust & guardianship litigation; professional malpractice; real estate; securities and corporate governance; tax; and technology & entrepreneurial companies. Gunster is ranked among the National Law Journal’s list of the 250 largest law firms. |
