Reprinted with permission:
2010 was a strange and unsettled year for persons wishing to plan their estates and/or make current transfers of their assets. Many, but by no means all, of the uncertainties were resolved on December 17, 2010, when President Obama signed theTax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (the “2010 Act”). The 2010 Act particularly resolved concerns that the gift, estate and Generation Skipping Transfer (“GST”) tax rules would be applied on a retroactive and unfavorable basis to decedents dying in 2010 (during which these taxes had been repealed).
The most important gift, estate and GST tax provisions of the 2010 Act will be effective for only two years, and the resolution of many issues is more apparent than real. Such is the price for another compromise by a legislature that, for institutional reasons, has been unable to enact rational transfer tax legislation for at least a decade.
To add to the complications facing planners and clients, there remain a number of estate tax planning problems for New York residents (and residents of other states which continue to have estate taxes), which were not addressed by the 2010 Act.
Vincent L. Teahan