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Home>>Expertise>>Financial
/ Estate Planning Tax and Estate Planning Common
Issues As CPAs we face
questions like the following almost daily: Which retirement plan will get me the most tax savings? Should I participate in my company’s fringe benefit plan? What are the tax rules for the 529 plan? What is the marriage penalty in the tax law? When will be the best time for me to make that donation? How can I avoid the "kiddie tax"? Trust or will, which one is better? The next important question seems to be:
After the money is earned, how can you accumulate and grow more; spend
wisely, and always have enough for yourself and your loved ones? Solutions Our answer to the question is simple: plan ahead and
plan well. Prepare for
the predictable, guard against and be ready for the unexpected, save as
much as you can
for the future and share with Uncle Sam the least possible amount the law
allows. Why is planning so important? On income taxes, for example, the 2003 tax law gives everyone the lowest capital gain and dividend tax rates we have ever seen. It even levies no tax on dividends and long-term capital gains in 2008 to those who are in lower tax brackets. Therefore, if a retiree plans ahead and can live on dividends and capital gains then he will not need to send Uncle Sam anything in that year. On estate taxes (most likely it will stay with us and 2010 is only a one-year "sabbatical"), assume a couple with a $2.5 million taxable estate only had a simple will, the federal estate tax would take away about $680,000 (that's over one-quarter of the estate) in 2003. But if they set up an exemption trust, Uncle Sam would only get about $210,000 (that's less than 10% of the estate). By engaging the planning tool, it would result in a whopping $470,00 savings in taxes for the couple and their children! Proactive planning is the key. And we stand by to assist you. |
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