After years of changes and political arm-twisting, the federal estate tax rules became clear and stable with the year-end fiscal cliff deal. They are now set permanently into the tax code – at least until the tax code changes again.
Do we now find ourselves living in the calm after the storm? The estate tax laws seem to have finally found a safe harbor after so many years of indecision, short-sighted planning, and even damage control. So are you confident with your estate planning, or are you still somewhat concerned?
As you may have heard, the midnight compromise signed into law just before the tax law shifted back ten years into the past, otherwise known as the American Taxpayer Relief Act of 2012 (or ATRA 2012), finally set estate laws and wealth transfer taxes into stone. While “permanent” and “tax law” may seem a bit oxymoronic, the deal struck in stone is at least better than the silly putty in play for a decade.
A recent Reuters article titled “New estate tax rules call for new planning tactics” is a clarion call to review your estate planning. Some of the tax changes may have created some unintended consequences you ought to investigate, especially with the more generous federal estate tax exemption amount.
Regardless, it is prudent to review your estate plan from time to time. After all, estate planning is a process, not an event.