A White Paper for Clients and Their Advisors Prepared by
the Private Wealth Services Group of McGuireWoods LLP
Because Congress did not act in 2009 to preserve the estate and
generation-skipping transfer ("GST") taxes in 2010, the
estate, gift, and GST taxes, which are sometimes collectively
referred to as the transfer taxes, have changed greatly from what
they were in 2009. As a result of the provisions of the 2001 Tax
Act, the estate and generation-skipping transfer or "GST"
taxes have been repealed for one year while the gift tax remains in
place with a $1 million exemption and 35% maximum rate. In 2011,
unless Congress acts, the estate, gift, and GST taxes as they
existed prior to 2002 will be reinstated with a 55% rate, a $1
million exemption for lifetime and testamentary transfers, and a $1
million exemption (indexed for inflation since 1999) from GST tax.
Congress may or may not act to reinstate the estate and GST taxes
and, if it does, it may or may not reinstate them retroactively.
All of this has created an environment of uncertainty in which
individuals must review their estate plans to ensure that their
wishes are carried out while minimizing their exposure to estate
tax. This uncertain environment may also present opportunities for
individuals to take advantage of the current law.
McGuireWoods has prepared a white paper discussing those matters
of which individuals need to be aware in light of the current
uncertainty and different strategies that individuals may wish to
consider in order to take advantage of the current law.
The Treasury Department's Financial Crimes Enforcement Network (FinCEN) announced an automatic six-month extension for taxpayers required to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR).
One of the most publicized and long-awaited business provisions contained in the Omnibus Budget Reconciliation Act of 1993, P.L. 103-66, 107 Stat. 312 (1993) (the "1993 Act") was section 197 of the Internal Revenue Code of 1986 (the "Code"), which governs the tax treatment of acquired intangible assets. However, section 197 cannot be analyzed in isolation. Since it comes into play whenever there is an allocation of consideration to an amortizable section 197 intangible, a basic understanding of
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