The amount exempt from the federal estate tax goes up to $5.49 million per decedent on January 1, 2017, an adjustment for 2016 inflation. The lifetime federal gift tax exemption is also $5.49 million. Married couples have two exemptions, so they can shield $10.98 million from transfer taxes. However, in the minority of states that…
Year: 2016
Social Security in 2017
Automatic cost-of-living adjustments (COLAs) were created for Social Security benefits in 1975. The COLA for 2017 is 0.3%. Here are the basic Social Security numbers in 2017 for your reference. Tax rate for employees 7.65% Tax rate for self-employed 15.30% Maximum earnings taxable Social Security wage base $127,200 Medicare wage base no limit Retirement earnings…
Tom Clancy's Widow Wins Her Court Battle
The estate plan of noted author Tom Clancy had three equal trusts, one for the children of his first marriage, a marital trust for his surviving second wife, and a family trust for the second wife and the daughter they had together. The trusts were funded from the residuary estate (whatever is left after paying…
IRS Announces 2017 Retirement Plan Limits
To make it possible for voluntary retirement savings to keep up with inflation, the various numerical limits embedded within qualified retirement plans are indexed for inflation. In October the IRS announced the numbers that will apply in 2017, as shown in the following table: Note that the deferral limits for 401(k) and 403(b) plans are…
Domicile and Taxes
Thomas Campaniello had apartments in New York City and in Florida. He also had a sizeable income. In 2006 Campaniello decided to change his domicile to Florida but still spend time in both states. That is easier said than done, as far as the taxing authorities are concerned. You can’t just declare where you want…
SECRET CLAUSES IN TRUSTS
When Dmitri remarried in 1989, he created a revocable trust for his wife and his two sons from his first marriage, his only descendants. The sons were to receive a distribution from the trust at Dmitri’s death, but most of the assets were to remain in trust for the life of the surviving spouse. At…
A Trusted Solution for Settlement Dollars
Authored by Sean Rice In the event of a personal injury litigation settlement, the mainstream solution has been to place some or all of the beneficiary’s proceeds into a structured settlement annuity contract. Reasons for this investment choice vary among those involved in the settlement process. Some cite the desire to protect the funds from…