September 01, 2014

The ATRA-Math—Estate Planning After the 2012 American Taxpayer Relief Act: An Interview with Thomas J. Pauloski

R.D. “Don” Estes

The American Taxpayer Relief Act of 2012 (ATRA) changed the face of estate planning considerably. For example, the “applicable exclusion amount” that each person may exclude from federal gift and estate tax was scheduled to revert to a fixed $1 million effective January 1, 2013. Instead, ATRA permanently established a $5 million exclusion that is indexed for inflation; today, the applicable exclusion stands at $5.34 million per person and $10.68 million for married couples. As a result, it is estimated that only 1 in 700 families currently has enough wealth to need tax-driven estate planning. How has ATRA changed planning for those families? And what should the other 699 families do? Thomas J. Pauloski, national managing director in the Wealth Planning and Analysis Group of Bernstein Global Wealth Management, Chicago, answers these and other questions. The opinions expressed are those of Mr. Pauloski, not those of Bernstein Global Wealth Management or the ABA.

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