By Suzanne Burchett

Within recent weeks new Proposed Tax Regulations may remove the ability to use numerous discount strategies that are able to eliminate or substantially reduce estate and gift taxes on large estates. If you have or expect your “taxable” estate to be larger than the current exclusion amounts ($11 million for a married couple) these newly Proposed IRS Regulations could make it necessary to seek advanced estate planning now! In order to avoid the adverse effect of these regulations you must complete transfers to a specialized trust or your heirs before these Regulations are finalized. This timeline could be as soon as the end of this calendar year .

Estate planners and the sophisticated have been using these discounts to reduce estate and gift tax exposure. The Proposed Regulations will limit their use and the bad news is that this will result in the confiscation of millions of dollars of value by the gift and estate tax system. These Proposed Regulations hopefully will have a 90-day comment period with the public hearing being held on December 1, 2016, making it almost impossible for them to become final before the end of this calendar year. Although, the outcome of the election could have an impact on the finalization of the Proposed Regulations. It is thought that if Hillary Clinton is the winner, the IRS will finalize them early in her administration. On the other hand, if Donald Trump is elected, there is an expectation that the IRS possibly will have the Proposed Regulations finalized before the end of President Obama’s term.

You may think this does not effect you because you only own one or two buildings with a total value of about 4-5 million dollars but, in ten years those same buildings may be well over the threshold. It is advised that you seek the advice of an Estate Planner and your Certified Public Accountant for advice and possible evaluation of how these Proposed Regulations could effect you.

Consult with your legal advisor or tax planner.