Proceed with caution when helping children buy a home

According to The Project on Student Debt, the average student debt at graduation in 2018 ranged from $19,750 in Utah to $38,650 in Connecticut, and new graduates’ likelihood of having debt ranged from 36% in Utah to 76% in New Hampshire. While the job market is bright, this much debt makes it very difficult for …

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IRS update: Itemizing deductions on estates and trusts

When the Tax Cuts and Jobs Act (TCJA) was passed, it prohibited individual taxpayers from claiming miscellaneous itemized deductions for any taxable year beginning after 12/31/2017 and before 01/01/2026. After two years, the IRS has finally issued proposed regulations to clarify how the rules on miscellaneous deductions apply to trusts and estates. Don’t miss: What …

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The history of federal estate tax rates

Even though estate taxes don’t affect many people, they have been a hot topic in the political realm after the Tax Cuts and Jobs Act doubled the lifetime exemption. Don’t miss: Inherited IRAs The estate tax exemption has seen some extremely significant changes since it was enacted in 1916. At this point in time an …

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CARES cares about charitable donations

There are some provisions in the CARES Act that are not getting a lot of play right now – probably because it is not immediate money in business or individual’s hands. It can be money for nonprofit organizations, though. Don’t miss: CARES Act clarification for trustee/plan sponsors So while we will see how this comes …

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Estate and Gift exemptions increase to $11.58 million in 2020

The IRS announced in Revenue Procedure 2019-44 that the 2020 gift tax annual exclusion will remain at $15,000 and the unified estate tax and lifetime gift exclusion amount will rise to $11,580,000 per person or $23,160,000 per couple in 2020. In 2020 any person can gift up to $15,000 to another person using the annual …

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Splitting passive losses during divorce

Many couples acquire partnership interests during marriage that generate large passive losses. If they don’t have enough passive income to offset these losses, the losses are suspended under the passive activity rules. For couples residing in a community property state, the losses are deemed to be owned 50% by husband and 50% by wife. Don’t miss: …

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Donating appreciated stock to charity

If you are planning to make a substantial contribution to a charity, it’s better to donate appreciated stock from your investment portfolio instead of cash. Why? You get a deduction for the donation AND avoid tax on the appreciation in value of the donated property. This planning tool is derived from the general rule that the …

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Estate planning: don’t forget your IRA

The IRA is often overlooked when clients meet with their attorney for estate planning. This may be because the IRA owners complete the beneficiary designation form themselves and are unaware of potential pitfalls. Often, the value of the IRA alone far exceeds the value of the planned for estate. Failing to have your attorney review …

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Annual exclusion gifts and your tax picture

In 2018, the IRS increased the annual gift tax exclusion to $15,000. The exclusion will remain at $15,000 for 2019 too. What does this mean for gifts you make? Each year, you can gift up to $15,000 per person before the gift is considered taxable and without being required to file a gift tax return …

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