Estate Planning Strategies Columns for the Journal of Financial Services Professionals

Since May, 2003, Dennis Reardon has written an “Estate Planning Strategies” column for the Journal of Financial Service Professionals. The following is an index of those columns in reverse chronological order, followed by abstracts of those columns for the past several years.

In Articles Posted

FSP Article 2013 May

New Estate and Income Tax Rates May Change Perspective for Major Gifts

Fortunately, while no one can predict the extent of asset growth and the exact mortality outcome for a given individual, we can apply a formula to calculate the risk of failure versus the benefit of success with regard to the overall tax planning result for gifts. Two major variables influence the amount of growth required to reach breakeven: the spread between income tax and estate tax rates, and the basis of the asset. However, other considerations exist.

FSP Article 2013 May (Click here to download PDF)

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In Articles Posted

FSP Article 2013 Jan

Welcome to 2013: Spousal Access Trusts Still Attractive for Business Owners

Spousal Access Trust refers to an irrevocable trust established by a married grantor for the benefit of the grantor’s spouse during the spouse’s lifetime, with the remainder interest passing to the couple’s children after the spouse dies. It is usually structured as a grantor trust for income tax purposes, with the value of the trust removed from the grantor’s estate for estate tax purposes, and from the surviving spouse’s estate at his or her subsequent death.

FSP Article 2013 Jan (Click here to download PDF)

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In Articles Posted

FSP Article 2012 Sept

Defined Value Clause Offers Gift Tax Planning Certainty

Estate of Wandry v. Commissioner is the latest word from the Tax Court with regard to defined value clauses. The difference between a valid defined-value clause and an impermissible savings clause can seem metaphysical when viewed side by side in certain instances. Nonetheless, the commitment to a fixed-dollar amount satisfied the Tax Court so that Wandry now offers a blueprint for clients to follow. The Wandry case offers timely guidance, especially at this time when many wealthy clients are being encouraged to consider making substantial gifts before the end of 2012.

FSP Article 2012 Sept (Click here to download PDF)

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In Articles Posted

FSP Article 2012 May

Disability Buyout Considerations

Buy-sell agreements typically address measures to be followed if a business owner dies, as well as a host of possible lifetime “triggering events” that may lead to a sale of the owner’s business interest. Not enough attention is typically paid to the prospect that an owner may become disabled. A proper buy-sell agreement should consider the following: (1) disability buyout versus disability income, (2) the definition of disability, and (3) valuation — not just how much, but when. Alternatively, clients should consider disability buyout insurance.

FSP Article 2012 May (Click here to download PDF)

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In Articles Posted

FSP Article 2012 Jan

Nontax Fundamentals in Trust Planning

We look at the selection of a trustee, a trustee’s exercise of discretion, and designation of a successor trustee for maximum flexibility. Whether large or small, relatively complex or relatively simple, a trust arrangement that has a sound selection process, clear standards for distribution decisions, and procedures to ensure its continuation can work very well for its beneficiaries.

FSP Article 2012 Jan (Click here to download PDF)

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In Articles Posted

FSP Article 2011 Sept

Large Gift Tax Exemption Opens the Window for Gifts of Business Interests

The Tax Act of 2010 introduced a $5 million exemption for federal estate and gift tax purposes that will be in effect for gifts and estates through the end of 2012. This provision may be the most dramatic development that emerged from the 2010 law. While it necessarily has a host of possible planning applications, it offers a clear opportunity for the owners of closely held businesses to accelerate transfers of ownership in the near future.

FSP Article 2011 Sept (Click here to download PDF)

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In Articles Posted

FSP Article 2011 May

Estate Plans Need Flexibility in Current Tax Law Environment

Every change in the new tax law offers planning opportunities, loopholes, and potholes. What should we do about it now? Which planning techniques should be adopted or discarded? Who is immediately affected? Who might as well wait until the two-year period is over, and do we have a new short-term solution or, maybe, a long-term structure?

FSP Article 2011 May (Click here to download PDF)

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In Articles Posted

FSP Article 2011 Jan

Ensuring the Transfer of Insurance Proceeds in Buy-Sell Agreements

Few of us who enter into transactions spend much time thinking about the variety of downside risks that may surface with a buy-sell agreement. If the policy will not be owned by the other shareholder, who should own it? Specifically, what type of entity should own it on behalf of the surviving shareholder?

FSP Article 2011 Jan (Click here to download PDF)

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