This change in the federal estate and gift tax law allows one, either during lifetime (by gifting) or upon death, to pass a staggering amount of money without the payment of any federal taxes.
WHITE PLAINS, N.Y. (PRWEB) January 23, 2018
The recently signed into law Tax Cuts and Jobs Act of 2017 provides for a dramatic increase in the federal estate and gift tax credit. Westchester elder law attorney Anthony J. Enea of Enea, Scanlan & Sirignano, LLP in White Plains and Somers, N.Y. recently addressed the impact the new law will have on federal estate taxes and why it highlights the importance for seniors to refocus their attention to their long term care planning.
As of January 1, 2018, the federal estate and gift tax credit has increased to $11.2 million per person – more than double the previous $5.49 million in 2017 – and $22.4 million for a married couple. This substantial increase in the amount excluded from taxation now means the vast majority of Americans will not be impacted by federal estate and gift taxes.
“This change in the federal estate and gift tax law allows one, either during lifetime (by gifting) or upon death, to pass a staggering amount of money without the payment of any federal taxes,” said Anthony Enea, who has spent the past three decades protecting the rights of seniors, the disabled and their families. “Considering the amount of taxes imposed on one’s earnings and savings during one’s life, many would consider this to be a just result.”
The number of federal estate tax returns filed for 2018 is anticipated to drop from approximately 5,000 to 1,500 per year. Additionally, the new law allows the heirs and beneficiaries of the decedent to receive the property inherited at its fair market value on date of death, thus being able to avoid capital gains taxes unless the property/assets are sold for more than their date of death fair market value. The Tax Cuts and Jobs Act of 2017 law sunsets on December 31, 2025 unless extended by law. If not extended, the federal estate and gift tax credit will revert to an adjusted for inflation amount that is expected to be $6.5 million per person.
While New York and other states still have an estate tax, it is not as onerous as the 40% tax rate imposed under federal law for estates larger than the available credit. In New York, the available estate tax credit for 2018 will be $5.25 million per person and $10.5 million per couple (as indexed for inflation) with the highest tax rate of approximately 16% on amounts above the available credit.
So why does the new tax legislation makes long-term care and elder law planning even more important?
“With the federal estate tax and the New York estate tax being of little concern for most New Yorkers, the most important issue many seniors should focus on are the steps needed to ensure that their life savings are not dissipated by the significant cost of long term care (either nursing home and/or home care),” explained Enea. “It is important to take the necessary proactive steps to protect one’s life saving before health and aging issues rear their ugly head.”
Enea continued, “Whether it be utilizing an Irrevocable Medicaid Asset Protection Trust, the gifting of assets to loved ones, or purchasing long term care insurance, it is imperative that seniors act while they are in good health and are still capable of doing the planning.”
Named Westchester County’s Leading Elder Care Attorney at the Above the Bar Awards and Best Lawyers’ 2018 Elder Law “Lawyer of the Year” in White Plains, Mr. Enea is president of the Westchester County Bar Foundation and past chair of the New York State Bar Association’s Elder Law Section. His practice areas include elder law; Medicaid asset protection trusts; Medicaid applications (home care and nursing home); special needs planning; guardianships (Article 81 and 17-A); and wills, trusts and estates.
Enea, Scanlan & Sirignano, LLP is located at 245 Main Street in White Plains, N.Y. with additional offices in Somers, N.Y. Elder law attorney Anthony J. Enea can be reached at 914-948-1500 or a.enea(at)esslawfirm(dot)com. For the latest news, visit Enea, Scanlan & Sirignano online at http://www.esslawfirm.com.
About Enea, Scanlan & Sirignano, LLP
Enea, Scanlan & Sirignano, LLP is an AV preeminent rated elder law firm with offices in White Plains and Somers, N.Y. The practice concentrates on Elder Law; Medicaid Planning; Nursing Home and Home Care Applications; Wills, Trusts and Estates; Guardianships; Estate Litigation; Supplemental Needs Trusts; and Special Needs Planning. Enea, Scanlan & Sirignano, LLP serves Westchester, Rockland, Putnam, the Bronx, Manhattan, Long Island and Queens and is committed to providing the highest quality legal services to seniors, the disabled and their families. Visit the firm online at http://www.esslawfirm.com.