Federal Estate Tax: A Moving Target.

Estate Tax Changes for 2006 plan reviewed. One stratAs is often the case, egy our office has been exthis new year brings with ploring with many married it changes in the tax laws. clients is the Spousal OpAnd as night follows day, tion Trust, an alternative most people don’t know to the traditional credit quite how to proceed with shelter trust couples with the information. Trust me, taxable estates relied on it’s not your fault: the when the estate tax rerules are always changmained fixed. The Spousal i n g . I t ’s h a r d t o k n o w Option Trust is more flexwhere to aim when the tarJoseph S. Karp, ible, allowing the survivget keeps moving. C.E.L.A. ing spouse to decide if he Effective January 1, wants to split the estate into two 2006, the estate tax exemption intrusts, depending upon the estate tax creases to $2 million per person, up situation at the time of the first from $1.5 million, with the estate tax spouse’s death. on excess assets dropping from 47% to 46%. Looking beyond this year, Clients of The Karp Law Firm will the exemption will remain at $2 milget an overview of estate tax changes lion through 2008, but the top estate and other timely topics at our upcomtax rate will drop to 45% in 2007, ing annual Client Appreciation Breakand remain at that level until 2008. fast. Beside myself, firm attorneys In 2008, the exemption will jump to Genny Bernstein, Adele Small, Shaun $3.5 million. Weidrick and Rachel Goldstein ZeIn c a s e you ar en’t confused touni will be on hand to discuss a vaenough, in 2010 the exemption will riety of topics. Guest speakers Jack be eliminated. And in 2011—unless and Emily Robarts, public policy spethe Tax Reconciliation Act of 2001 cialists for the Alzheimer’s Associis revised by Congress by 2010—the ation SE Florida chapter, will proexemption will fall to $1 million, vide guidance on selecting the right with the top estate tax rate 55% to Medicare Part D plan. Another speak60%. er is a distinguished new addition to The second change is in what you our firm, Attorney Ron Friedman. A may gift annually without affecting member of both the Florida and New your lifetime exemption. This figure Jersey Bars, Mr. Friedman is Floririses to $12,000 per person, per year, da Bar-certified in Wills, Trusts and per recipient (up from $11,000), beEstates, and a former Estate and Gift ginning January 1, 2006. This means Tax Attorney for the Internal Revthat you may give up to $11,000 per enue Service. We look forward to year per recipient, to as many reciphaving him on board. ients as you wish, without impacting To all my readers, a happy and on your lifetime exemption. A marhealthy new year. ried couple can give any one recipJoseph S. Karp is a nationally certified ient up to $24,000 per year. If you’ve and Florida Bar-certified elder law attorney got a large estate and are looking for (C.E.L.A.) specializing in the practice of Trusts, ways to keep Uncle Sam’s hands off Estates and Elder Law. His offices are located at 2500 Quantum Lakes Drive, Boynton of the money you’d prefer to pass Beach; 2875 PGA Blvd., Palm Beach Garon to loved ones, this is one way to dens; and 1100 SW St. Lucie W. Blvd., Port do it. St. Lucie. Call him at 561-752-4550 (BoynSo what does all this mean for ton); 561-625-1100 (Palm Beach Gardens); or 772-343-8411 (Port St. Lucie). Toll-free you? The bottom line is that it’s probfrom anywhere: 800-893-9911. E-mail: KLF@ ably a good idea to have your estate Karplaw.com. or website www.karplaw.com