November 18, 2010  Volume 2, No. 3

This estate tax edition of Currents is from Robert F. DeMeter, Esq. a taxation and estate planning partner of the firm. Please contact Bob at RDeMeter@ClarkTrev.com to inquire about the subject matter of this issue.

For beneficiaries of a wealthy client who passes away in 2010, a timely disclaimer may offer a way to have family wealth skip a generation tax free.

Why a Disclaimer May Make Sense
In addition to eliminating the federal estate tax on wealthy decedents, the 2010 tax law eliminated the generation-skipping transfer tax. For children who have substantial estates of their own, it is often possible for one or more of the children of a wealthy decedent to disclaim all or part of that child's inheritance and have that inheritance pass tax free to the child's heirs. This strategy is particularly valuable for individuals who pass away in 2010 because of the elimination of the generation-skipping transfer tax for the year.

Evaluate This Strategy On a Case by Case Basis
Disclaimers are relatively simple documents, but the decision whether or not to use one and whether a beneficiary meets the requirements takes careful planning. If you have a wealthy client who has passed away this year, this is definitely a topic to discuss with the heirs. Should you need further details, please give me a call.

Contact Us
It has always been our goal to provide clients with flexible estate planning documents designed to accommodate changes in tax laws and family circumstances. However, in light of this new uncertainty created by Congress, you may wish to contact us in the new year to ensure your estate plan continues to meet your goals.

Currents is intended to be educational only.  It is designed to provide our clients and friends with the discussion of current topics and legal authorities as applied to those topics.  Currents is not intended to constitute legal advice or provide any opinion about the application of such legal authorities to a particular circumstance, set of facts or situation.  In addition, that you have received transmission of Currents does not create any relationship of attorney and client between Clark & Trevithick, PLC and you.

Clark & Trevithick, PLC is a full service law firm representing clients throughout California and western states for more than three decades.  Our practice includes specialization in federal and state taxation law and tax reporting compliance, as well as estate planning for owners of closely-held businesses and other high net worth individuals. We also counsel on the sale of closely-held businesses. We develop methods for transferring wealth to surviving spouses and descendants by the most efficient and tax-advantaged methods available.  Our practice profile also includes corporate, real estate, litigation, creditors' rights and remedies and employment law matters.

CIRCULAR 230 DISCLOSURE

TO COMPLY WITH INTERNAL REVENUE SERVICE REQUIREMENTS, PLEASE BE ADVISED THAT ANY TAX ADVICE CONTAINED IN THIS EDITION OF CURRENTS IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, BY THE RECIPIENT TO AVOID ANY FEDERAL TAX PENALTY THAT MAY BE IMPOSED UPON THE RECIPIENT, OR TO PROMOTE, MARKET OR RECOMMEND TO ANY OTHER PERSON OR ENTITY, ANY REFERENCED ENTITY, INVESTMENT PLAN OR ARRANGEMENT.  FOR MORE INFORMATION, PLEASE GO TO WWW.CLARKTREV.COM.

© 2010 Clark & Trevithick

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