Wipfli Alerts & Updates: URGENT—Enhanced Gift Tax Rules May Be Ending Soon
November 2, 2011
(PDF 40 kB)
We will soon hear from the widely discussed “Super Committee” in Washington, D.C. Earlier this year, Congress passed the Budget Control Act of 2011 and charged the newly-created committee with issuing formal recommendations that trim at least $1.5 trillion off the nation’s deficit over the next 10 years. Although the committee generally meets in private, they are required to present bipartisan recommendations to Congress no later than November 23, 2011, the day before Thanksgiving.
Last December, Congress unexpectedly increased the federal lifetime gift tax exclusion to $5,000,000 from $1,000,000. In September 2011, the Office of Management and Budget issued a report that makes clear which deficit reduction measures the Obama administration prefers. In particular, the administration strongly prefers a return to the pre-2010 gift tax rules. If the Super Committee includes this measure, the increased gift tax exclusion amounts could end this month. Currently, the rumor mill is spinning regarding a potential reduction of the gift tax exclusion as early as November 23, 2011.
Although it is impossible to confirm that the rumors will become reality, we recommend that you strongly consider taking advantage of the larger and more favorable gift tax rules now. Thankfully, several incredible giving techniques currently exist that capitalize on a "perfect storm" that includes depressed market values, low interest rates, and favorable tax laws.
Please contact Rick Taylor, Ryan Laughlin, or your Wipfli relationship executive with questions or to discuss further.
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