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Contents
About SC&H Financial Advisors, Inc. Personal Financial Planning is not a one-time event—it is a critical, ongoing process that, if managed well, leads to financial freedom. At SC&H, we develop complete and flexible plans that are designed to meet your ongoing needs. They are complete, because you need a fully integrated and comprehensive financial strategy that incorporates all of the most important wealth care issues. They are flexible, because milestones in your life such as a marriage, a career change, the birth of a child, a divorce, or a death in the family will require adjustments to your overall financial plan. Our financial planning methodology is based on the Method 10™ model, an approach that addresses the ten key areas of wealth management that comprise a comprehensive financial plan. To learn more about these services, visit www.scandh.com/fa.
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Our team wishes you and your family a safe and happy holiday season. As always, please let us know if we can be of assistance.
Regards, Greg Horning
The main focus of estate planning is to create the most effective vehicle in which to pass along your estate to your heirs while at the same time minimizing the associated tax bill. There is some confusion, however, as to exactly what the estate tax entails and who it affects. The estate tax is a levy on the transfer of assets to your heirs upon death and is based on the fair market value of the assets you held, less various exemptions and deductions. Contrary to popular belief, joint accounts and accounts payable on death are included in your gross estate when calculating the estate tax. Joint titling of assets merely helps to avoid the probate process but those assets remain subject to the estate tax. In the Economic Growth and Tax Relief Reconciliation Act of 2001, President George W. Bush fulfilled his promise to reduce taxes by granting numerous tax cuts and credits - the estate tax being a primary target. The legislation called for a steady increase in the one-time exemption and a corresponding decline in the highest effective tax rate beginning in 2002 and running through 2009.
Under current law, in 2010, the estate tax is set to be completely repealed for one year. In 2011, the provisions of the 2001 Act will sunset and the estate tax will revert back to the rates and exemptions that were in effect in 2001. Additionally, in response to the Bush Administration tax cuts, many states have decoupled from the federal estate tax system, thus subjecting many taxpayers to state-level estate tax, even if those people are exempt from the federal estate tax. With the sunset date quickly approaching, many are anxious to see the fate of the estate tax. The Obama Administration is proposing to maintain the estate tax at its current level. This would result in a $3.5 million exemption for a single taxpayer and a couple could shelter $7 million from federal estate tax. However, until Obama’s plan is enacted, the estate tax exemption and rates will revert back to 2001 amounts of a $1million exemption and maximum tax rate of 50%. Most experts agree that we will see a major estate tax bill in 2009, in order to avoid the complete loss of estate tax revenue in 2010. Given this situation, estate tax planning has become much more difficult due to the uncertainty of the current tax law. With the constant changing landscape of the estate tax, it is prudent to take the time to meet with your financial advisor to evaluate your estate planning needs in order to preserve your hard-earned assets for your loved ones.
Securities offered through 1st Global Capital Corp. Member FINRA, SIPC. Investment Advisory Services offered through SC&H Financial Advisors, Inc. Insurance offered through 1st Global Insurance Services. SC&H Financial Advisors, Inc. and 1st Global Capital Corp. are unaffiliated entities. |
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