Newport Beach Attorney Says Prepare Now For Year-End Changes to Estate Tax Laws
You've worked hard to save money, accumulate assets and leave your loved ones an inheritance after your passing. But according to Darlynn Morgan, an estate planning attorney in Newport Beach, the expiration of key tax laws in Congress may now put more local families at risk of owing more than half of their inheritance in "death taxes" after the first of the year.
- Orange County, CA (1888PressRelease) September 25, 2012 - The expiration of key laws in Congress may expose more local individuals to estate or "Death Taxes" after their passing. Newport Beach attorney, Darlynn Morgan explains these anticipated changes, as well as steps Newport Beach residents can take now to take now to ensure more money goes to their family-and not Uncle Sam-after death.
Darlynn Morgan explains how preparing now for the much-anticipated expiration of the Bush-Era tax cuts (which were extended temporarily under the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act in 2010) is critical for high-net worth individuals, but also for middle-class families, too. Here's why:
• If Congress does nothing and the legislation expires, the estate tax will revert from a $5 million exemption to $1 million on December 31st. That means if your estate is worth over $1 million at your passing, your family may be on the hook for significant taxes up to 55%.
• For many people, when you add up the value of your home, life insurance policies, investments and assets, $1 million is usually closer than you think.
• The payment is due in cash just 9 months after you die (or the 2nd spouse dies if you are married), often forcing loved ones to sell assets quickly at depressed market or "fire sale" prices to satisfy the bill.
• There's a very real chance that up to half of the inheritance you worked so hard to leave your family will go to Uncle Sam.
The good news, Darlynn Morgan says, is the estate or "death tax" is entirely voluntary and there are steps you can take right now to minimize your exposure.
She explains that one such strategy is to utilize the lifetime gift tax exemption, which also set to expire at the end of the year. This law allows you to remove up to $5.12 million (or $10.2 million for married couples) out of your "taxable estate" by gifting it now to future generations. On December 31st at midnight, the exemption amount significantly drops to $1 million. In other words, for the rest of this year, Morgan says that parents can pass along valuable assets to their heirs up $5.12 million (i.e. a house, stock portfolio, part of the family business), without paying a single dime to Uncle Sam.
Darlynn Morgan further notes tools such as living trusts can also be used to minimize your exposure to burdensome taxes after your passing. Your estate planning attorney will advise you on the best strategies to implement based on your wishes and financial needs.
Why Does This Matter Now?
Because proper estate tax planning requires getting appraisals, amending titles and creating airtight documents, Darlynn Morgan warns that planning must be started now to ensure everything is finalized before the end of the year. She says estate planning firms across the country are already busy handling year-end estate tax planning, and encourages individuals affected by these changes not to wait until the last minute to get professional help.
For more information on upcoming changes to the estate tax laws or on Newport Beach attorney, Darlynn Morgan, please visit www.morganlawgroup.com or call (949) 260-1400.
ABOUT DARLYNN MORGAN - California Probate Attorney
OC Trusts Lawyer Darlynn Morgan and Morgan Law Group is a Southern California Probate Attorney / Estate Planning Lawyer / Wills & Living Trusts Law Firm Serving: Los Angeles, Orange County, Riverside, San Bernardino, San Diego & all of Southern California
Probate law firm Morgan Law Group, serves all cities in Orange County, including: Aliso Viejo, Anaheim, Balboa Island, Brea, Buena Park, Capistrano Beach, Corona Del Mar, Costa Mesa, Coto de Caza, Cypress, Dana Point, as well as estate planning in Foothill Ranch, Fountain Valley, Fullerton, Garden Grove, Huntington Beach, Irvine, La Habra, Laguna Beach, Laguna Hills, Laguna Niguel, Laguna Woods, Lake Forest, and estate planning and probate in Los Alamitos, Mission Viejo, Newport Beach, and estate planning and probate law firm information in Orange, OC, Placentia, Rancho San Margarita, Rossmoor, San Clemente, Santa Ana, Seal Beach, Sunset Beach, Tustin, Villa Park, Westminster, and Yorba Linda.
Orange County California probate law firm Morgan Law Group, serves all counties in southern California. For more information about Estate Planning Lawyer Darlynn Morgan, call: 949.260.1400 or visit www.MorganLawGroup.com
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