President Obama's new budget includes several changes to the tax laws. As promised, most of the benefits are for families earning under $250,000. These include the continuation of the 10% tax bracket, the child tax credit and education incentives. There is also a provision to increase the Alternative Minimum Tax (AMT) exemptions for 3 years.
The most notable change relates to the Estate Tax. As you may know, the estate tax is scheduled to go away next year and then the following year revert back to pre-Bush law (meaning that the standard exemption goes back to pre-Bush increases).
The proposal in the budget is to permanently allow a $3.5m exemption for individuals and a $7m exemption for couples. This is a relief to many of us, who were concerned that this Administration might severely reduce the exemption. This gives us some level of certainty for estate and gift planning.
If you have not done your estate plan, or would like a review of it, please contact our office at cs@provisionwealth.com or call us at 866.467.5809. We are happy to review your situation and help you determine what you can do to reduce or eliminate your estate taxes while protecting your family from probate.
Warmest regards,
Tom