The current scheduled changes in the estate and gift tax rates and exemptions have me struggling to come up with some good titles for people with a net worth of $4 to $15 million. How about “midmillionaires,” or “midmills” for short?
political winds are blowing with great uncertainty- especially as the election season heats up. Estate planners in particular find themselves on shifting sands when it comes to reading the tea leaves for their clients.
Who do estate planners think are most susceptible to the legal and tax currents this year? Peter Reilly at Forbes has given them a name: the “midmills,” short for the “midmillionaires.” According to Reilly in his article titled Beating The Possible Estate Tax Increase Without Switching To Cat Food - The Midmill Dilemma, this group of taxpayers has a fairly high net worth- somewhere between $4 and $15 million. So, what kind of estate planning should they pursue? After all, the current exemption amount to the estate tax, which is unified with your lifetime gift exemption, is only set at $5.12 million until December 31, 2012. Unfortunately, next year is uncertain.
The good news is that Peter Reilly is not one to just acknowledge problems. He’s a census-taker too. Consequently, Reilly has compiled the opinions of various Forbes columnists and has weighed in himself. At least one thing is clear: no one is certain about “Midmill Dilemma.” In the end, the dilemma comes down to you, your risk aversion, and the kinds of assets you have.
Regardless of whether one has a few millions at stake or not, we’re all in the same boat. Proper estate planning is a necessary tool for everyone, even when we’re not sure what Congress will throw at us.
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Reference: Forbes (May 2, 2012) Beating The Possible Estate Tax Increase Without Switching To Cat Food - The Midmill Dilemma