James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Fiscal Cliff Deal Has Various Estate Tax Implications
Author: James F. McDonough
Date: January 9, 2013
Key Contacts
Back
With the fiscal cliff avoided and new capital gains and estate tax laws implemented by the federal government, changes are abound for taxpayers in all earning ranges, though the wealthiest earners will see arguably the most substantial losses from the legislation passage.
Due to the passage of the American Taxpayer Relief Act (ATRA), high-net earners will see their dividends and capital gains taxes rise from 15 to 20 percent beginning this year. Moreover, while the law will keep the federal estate tax exemption at $5 million, the top tax rate of 35 percent will jump to 40 percent.
Though the estate tax is likely to affect many high-earners and business owners, a finance expert indicated ATRA will ultimately help the overwhelming majority of Americans.
“You could say this eliminates the estate tax for 99 percent of the population, though I’ve seen figures that say 99.7 or 99.8,” former Internal Revenue Service inspector Richard A. Behrendt told the New York Times.
He added that in terms of policy, the estate tax increase was implemented for a small segment of high-earning Americans – those inside the top 1 percent of earning nationwide. Trusts and other tax vehicles can also further reduce their liabilities.
One concern another finance expert, Carol G. Kroch, a managing director for wealth and philanthropic planning at Wilmington Trust, has regarding the passage of ATRA is that some high-net earners may avoid some financial planning ideas due to the tax law changes. However, she noted many of these individuals “can still create that pool of wealth” via trusts, despite the estate tax increase.
- Practices: Tax, Trusts & Estates
- Locations: Red Bank, NJ, New York City, Washington, D.C., Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
How Understanding Bankruptcy Trends Can Benefit Your Business
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
Author: Brian D. Spector
SEC Takes Actions Against Issuers for Failure to File Form D
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Author: Kenneth C. Oh
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
Author: Matthew F. Mimnaugh
What Are FIRPTA Withholding Requirements?
If you purchase real property from a foreign person or entity, you may be required to withhold taxes from your payment to the seller under the Foreign Investment in Real Property Tax Act (FIRPTA). The federal tax law is designed to ensure that foreign sellers pay any applicable capital gains tax on profits realized from […]
Author: Jesse M. Dimitro
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.