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IRS Gives Away Trillions to Heirs of Millionaires In The Final Days of 2012

Obama's Last Holiday Gift Winds Down

Estate Street Partners (UltraTrust.com) affirms that for individuals with assets, there is only a limited time to save literally Millions before the Tax Relief Act expires December 31, 2012

Boston, MA (PRWEB) November 29, 2012
Marginal estate tax rates are reverting back to 55% on Jan 1, 2013 as politicians bicker over how they will spin the next tax increase with the fiscal cliff looming and the smart millionaires will be gifting their assets to an irrevocable trust, getting it out of their estate in order to minimize the amount that is, UltraTrust.com says. This is thwarting President Obama and his cohorts but it makes one generous Holiday Gift.
Merrill Lynch and Cap Gemini reported in their 2011 World Wealth Report that the U.S. had 3.1M millionaires. Furthermore, they defined household wealth by excluding their personal residence and only including liquid assets. However, based on this and other research, Rocco Beatrice of UltraTrust.com, estimates 2.1 million have assets of $5 million or more.
top quote We have never seen breaks this size before 2011, and with the political posturing, it is highly likely that we will never see this size of a tax break again either.top quote
And based on this estimation, if all millionaires worth $5M or more took advantage of this tax loophole before the January 1, 2013 deadline, the IRS would be giving up to $4.6 trillion in total tax breaks.
"In laymen's terms, this means that an individual worth $5 million including their home and investments decides to gift this amount to their children to save on estate taxes after December 31, 2012, then their children will have to pay $1,750,000 in gift taxes. If one fails to gift anything and passes away in 2013 or beyond then their children will need to pay $2,200,000 in estate taxes as heirs."
"Because the IRS is not very forgiving, if you are asset rich, but cash poor, this means that your heirs will need to have a fire sale to raise money for the IRS - it happens very frequently to business and real estate owners," warns Rocco Beatrice, Managing Director of UltraTrust.com.
If you are worth $2.5 million and do your gifting in January, it will cost you $900,000 more than it would in 2012. If you fail to gift anything and pass away in 2013 or beyond, your heirs will need to come up with $825,000 for estate taxes.
Until the end of 2012, each spouse may gift any amount up to $5.12 million. Assets can be gifted to an irrevocable trust such as the premium UltraTrust® irrevocable trust which eliminates probate and estate taxes upon transference of the assets to heirs after the parents pass away.
"By having a gift tax exemption level up to $5.12 million, so much money can be saved in potential estate taxes it is truly a once-in-a-lifetime tax savings opportunity that should not be passed up. If you have an estate that contains assets worth more than $1 million, this is something you should definitely take advantage of. Since the exemption will soon drop back to $1 million [on January 1, 2013], there is no better time to plan. This is just good asset protection planning; and if your advisor has not brought this to your attention, it is time to become your own advocate."
The tax law that was in effect from President Bush will expire on December 31, 2012. This gift tax exemption reverts to $1 million at the beginning of 2013 from $5.12 million this year. In order to reinstate this exemption, it will be necessary for a new legislation to be signed by President Obama and passed by Congress. Otherwise, the gift tax exemption amount will return to $1 million as originally planned.
"We have never seen breaks this size before 2011, but with the U.S. deficits and the attacks by Obama and the Democrats on the wealthy, it is highly likely that we will never see this size of a tax break again either," says Rocco Beatrice.
About Estate Street Partners (UltraTrust.com):
Your assets are protected from frivolous lawsuits while eliminating your estate taxes and probate, and ensuring superior Medicaid asset protection with Estate Street Partners' Premium UltraTrust® Irrevocable Trust. Call Estate Street Partners today at (888) 938-5872 to learn how we can save you hundreds of thousands or millions of dollars in taxes and get your peace of mind back.
Sources::
  1. irs.gov/businesses/small/article/0,,id=108139,00.html
  2. http://www.irs.gov/publications/p950/index.html
  3. http://blogs.wsj.com/wealth/2011/06/22/u-s-has-record-number-of-millionaires/



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