Comments on: Planning Implications of Proposed Estate Tax Changes

By: Walt Bristow

Walt Bristow — Wed, 03 Jun 2009 19:04:34 +0000

There’s an article on Kiplinger.com you may want to look at. The author says “The best tool I have seen for reconstructing basis in this kind of situation is called BasisPro. It’s part of a service called Gainskeeper, which is available for $349 per quarter. Also, the same service is available as part of TurboTax Premier tax preparation software.” The Turbotax software is $74.95. Marketwatch and Yahoo Finance can also help track down historical information. If the stock is held at a brokerage firm, their reorg departments may be able to help. Sometimes those back offices can do miracles. CCH publishes the Capital Changes Reporter. It has data on over 58,000 corporations going back over 100 years. You may be able to get access through an investment firm. Also, CPAs may have it. Larger libraries may have copies as well. It’s available in print, on CD and on the internet.

By: Geraldine Brown

Geraldine Brown — Wed, 03 Jun 2009 18:53:41 +0000

Do you have any tips for reconstructing basis especially on stock that may once have been held in certificate form? I have a client who began buying stock when he got out of the navy after WW II and continued purchasing or used dividend reinvestment in the stocks for his entire life. Some like General Telephone are almost incomprehensible. They were then moved through several investment firms like Merrill Lynch and Fidelity, each time without a recorded basis. Since at his his age he could die next year and these assets are valued at at least $2,000,000, we do not want to have to claim zero basis for his heirs. Posted by Geraldine Brown, Attorney at Robert E. Bourne, P.C. on the Trusts and Estates Network group on LinkedIn.com

By: Heinz Brisske

Heinz Brisske — Tue, 02 Jun 2009 16:10:01 +0000

If portability becomes a reality in any new federal estate tax legislation, many people will be lulled into a false sense of security and think that they no longer need to engage in credit shelter planning. For many, that could end up being a huge mistake. For instance, not setting up a credit shelter trust means that the leverage available in such a trust will be lost. Assume that the predeceased spouse sheltered only $2 million. If the surviving spouse lives for a considerable period of time beyond that first death, that $2 million could easily grow to $3 million or beyond (assuming healthy rates of growth), and the surviving spouse would still have $5 million of exclusion to use ($7 million minus $2 million). Also, for second marriage situations, or remarriage situations, being able to protect assets for the predeceased spouse's children is much more easily accomplished using a credit shelter trust than a marital trust. Asset protection is another reason to continue to do credit shelter planning. On the whole, even if portability becomes the law, I think that estate planners will be well-advised to review each client's situation very carefully. Most married clients with larger estates, in my opinion, will still benefit from credit shelter planning. It may look somewhat different depending upon state death tax laws in your jursdication and other changes to federal estate tax laws, but the core principles will continue to be valuable and applicable. Posted by Heinz Brisske, Principal, Huck & Brisske, LLC on the Estate Planner Legal Network group on LinkedIn.com