James F. McDonough
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The Clintons Criticized For Estate Planning
Author: James F. McDonough
Date: July 2, 2014
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The latest in the media is the revelation that the Clintons are using financial planning strategies that will fall on their heirs at the time of their death.
According to federal financial disclosures, Bill and Hillary created residential trusts in 2010 and shifted the ownership of one of their homes into them the next year. The reason for this move is simple: by transferring the ownership of the home into a trust, any appreciation in the property’s value will remain outside of the Clintons’ estate. Because the top estate tax rate is approximately 40 percent of all assets, this could potentially save the power couple hundreds of thousands of dollars.
While the move to reduce their tax liability is certainly nothing out of the ordinary for people in the former president and first lady’s wealth class, the news comes at a time in which Americans are very aware of tax and wealth issues, and directly on the heels of another media frenzy. Just a few weeks ago, Hillary Clinton defended her $200,000 speaking fees to The Guardian by explaining that she and her husband were “dead broke” upon leaving the White House, according to Politico. She added that voters didn’t see her or her husband as part of the problem, because they paid ordinary income tax, in contrast to other wealthy individuals.
“If Hillary is going to run for President she might be advised to take a lengthy sabbatical from her $200k per pop speaking tour and private shopping sprees at Bergdorfs to try and reconnect with what’s happening back here on Earth,” wrote spokesman Tim Miller for America Rising, a Republican research group, according to the news source.
“Secretary Clinton’s point is about paying your fair share in taxes, unlike leading Republicans who try to evade tax responsibilities using offshore loopholes,” Adrienne Elrod, spokeswoman for the pro-Clinton group Correct the Record in response. “Mr. Miller has selective memory if he doesn’t recall reports that Mitt Romney reportedly maintained more than $30 million in the Cayman Islands.”
Understanding that the course you take in estate planning can be a tricky and complex subject, check out our series of posts that are related to estate tax planning if you are interested to learn more.
If you have any questions about this post or would like to discuss your company’s tax,trust, and estate matters , please contact me, James F. McDonough at ScarinciHollenbeck.com.
- Practices: Tax and Trusts & Estates, Sophisticated Estate Planning & Wealth Preservation, Estate & Trust Litigation, Real Property Tax Strategies
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
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