Year End Moves

Year End Moves

By: Martin M. Shenkman, CPA, MBA, JD

Last Minute Year End Moves To Make Now


Money Matters Radio – Estate Planning Q&A with Gary Goldberg

By: Martin M. Shenkman, Esq.



Introduction/Overview: Lots of tax rules are up in the air. Is there anything you should do now before year end?


Consider the following questions?


Why last minute moves now?

Year end planning is important. But isn’t it a bit early for last minute moves?


Not really, even so called “last minute” moves require more time than in the past. The regulatory requirements banks and investment firms such as yours face can require considerable time to get an account opened. In the “ol’ days” a lawyer could have a secretary drive to the bank or brokerage firm, pick up forms to sign and the account could be opened pretty quickly. That is far from the case now so clients have to plan their “last minute” earlier than the last minute.



Question: What are some good last minute moves?

Thanksgiving is this week. Is there still time to plan?


Sure. Gifts are one of the simplest and most powerful estate and financial planning tools. Next year we’ll have only a $1 million exclusion for the estate tax and a 55% rate. While lots of people believe the exclusion will be increased and the rate reduced, wishful thinking won’t protect your family. Make gifts before the end of the year if you haven’t done the maximum gifts already:

▀ Gift $13,000 to any heir you want to benefit if you haven’t already done this. Consider children, grandchildren, and if appropriate even their spouses. If you’re not married, consider gifts to a partner or friends.

▀ Pay for tuition or medical expenses for your heirs. Be sure to pay directly to the school or medical provider, don’t reimburse them.

▀ If you have children or grandchildren who might attend college you should consider setting up 529 plans and making the gifts to those plans, but that does take time.



Question: What about trusts?  

Are there any trusts clients should consider setting up now?


Sure, but they’re running out of time and it may be too late in many cases, so if a trust makes sense they’d better move quick. Grantor Retained Annuity Trusts, or “GRATs,” are a great tool for wealthy clients to shift appreciation to their heirs with little gift tax cost. These have been slated for restriction or repeal so clients should move quick to finish the planning before a change occurs.


The problem with doing trusts this late in the year is that the best way to plan a trust is to start with a comprehensive estate plan so you can really determine what the best approach is. If you want a document tailored to your needs, rather than an off-the-shelf form, that takes time. So if you add up the time to look at the big picture, develop a plan, draft a tailored document, and then deal with the banks, time is tight.



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