Estate Planning Attorney Addressing Tax Matters

The federal estate tax laws have placed an unreasonable burden on estates, essentially punishing people who have worked hard and handled their finances well. 

The federal estate tax law (a.k.a. the so called "death tax") is presently in a highly unstable state, and it has the real possibility of creating dramatically unintended results because of provisions in Wills and Trusts which were executed in earlier years. (This is particularly true for those married couples who have put in place the so called "A-B" trust plan.) Spouses may be accidentally disinherited, because of the design of certain "formula" clauses in existing documents. Capital gains tax may be unnecessarily incurred. Although we do not to appear alarmist, it is simply essential that existing plans be reviewed as a result of the new and current law.  To not review current plans is simply foolish, given these radical changes.

On January 1, 2010, the federal estate tax was repealed, but for only one year. On January 1, 2011,it again arises from the ashes, and comes back in play with only a one million dollar exemption, and a tax rate of 55%. (In 2009, the exemption was $3,500,000.)

Moreover, for 2010, the "step-up of the basis" rule, which essentially forgave the capital gains tax for assets passing at death, has been drastically reduced. 

Ohio estate tax remains in place, with an exemption of $338,333, and a tax rate of approximately 7%. 

This area of law is now quite complex, and its future is uncertain, at best.  Persons who want to be sure they have estate plans in place that will reduce all estate, income, and capital gains taxes as much as possible at death really need to promptly review the existing plans.  Tens, or hundreds, of thousands of dollars, may very well be at stake. 

Also, the beneficiary designations of IRA's and retirement plans (e.g. 401k, 403b, etc.) need to be carefully reviewed, especially if a trust is currently named as a primary or contingent beneficiary. Inattention to the complexity of this area of law can result in income tax paid in a few years after death, rather than gradually paid over several decades. The difference: potentially many thousands of dollars of tax deferred growth may be lost. Too many professionals have in the past recommended that trusts be the beneficiary of such accounts, without having a depth of knowledge as to the consequences of such advice.

David G. Umbaugh of Day Ketterer, Ltd., Attorneys at Law, devotes much of his legal practice to handling complex estate planning matters and reducing the federal and Ohio estate tax burdens. For more than 34 years, he has been serving clients in Northeast Ohio. Today, from offices in Hudson, Ohio, our firm relies on this knowledge and experience to effectively serve our clients.

Contact us today to schedule a confidential consultation with an experienced estate and tax planning attorney.

Effectively Handling This Rapidly Changing Area of The Law

The law governing estate tax matters changes rapidly; in selecting an attorney to address estate planning concerns and minimize the burden of taxes on your estate, it is important to select an attorney who truly focuses on these matters and will stay abreast of new developments in the law.

At our offices, we have been handling these matters for decades. We advise our clients regarding the current state of the law and anticipated future developments. We establish ongoing, long-term relationships with our estate tax planning clients, so that we can update their plans as necessary benefit most from the current law.

For any legal matters related to estate tax planning, come to our offices. Contact us today to schedule a confidential consultation with an experienced financial planning lawyer.

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From his office in Hudson, Ohio, David G. Umbaugh of Day Ketterer provides representation to clients located throughout Cuyahoga, Portage, Medina, Stark, and Summit counties, including the communities of Cleveland, Parma, Ravenna, Medina, Canton, Akron, Stow, Cuyahoga Falls, Twinsburg, Northfield, Bath, Montrose, Fairlawn, Solon, Beachwood, Brecksville, and Macedonia.

David G. Umbaugh of Day Ketterer, Ltd., Attorneys at Law
5 East Main Street
Hudson, Ohio 44236
Phone: (330) 650-6608
Fax: (330) 650-1185
du@davidumbaugh.net