ThinkAdvisor

May 22, 2023

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Act Now to Avoid Estate Planning Logjam in 2025

Clients with sufficient wealth to leave them exposed to future estate tax burdens need to understand that the time to act on the generous estate tax exemption established in 2017 by the Tax Cuts and Jobs Act is now — not when the expanded exemption sunsets the end of 2025.

 

In fact, according to Steve Lockshin, an experienced financial advisor and the founder of AdvicePeriod and Vanilla, it is already becoming more and more difficult to timely source the capabilities of specialist tax planning experts and estate attorneys who understand the rapidly evolving needs of high-net-worth and ultra-high-net-worth clients.

 

In a new interview with ThinkAdvisor, Lockshin warned in no uncertain terms that clients and advisors who fail to act now to prepare for the estate exemption sunset and other tax changes that are likely in the coming years are setting themselves up for failure. As Lockshin repeatedly emphasized, estate planning is a complicated and time-consuming process, and any given strategy can take years to fully implement.

 

This is true at the best of times, but history shows that big changes in tax laws always create estate planning logjams, and it is possible that advisors and their clients will simply not be able to source the legal expertise they need to create watertight estate plans in 2024 or 2025. It’s happened before, Lockshin warned — for example, when big changes happened in the late 1980s and in the early 2010s — and it will happen again.

 

“So, with that fact in mind, if you look at the calendar and you consider how long the creation of a really solid estate planning approach can take, we are already in the crunch time,” Lockshin said. “Simply put, now is the time for financial advisors with high-net-worth clients to look carefully at their estates and ascertain whether they will be taxable when the exemption sunsets — or if the estate might be taxable in the future based on projected values.”

 

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Read the full article here: Act Now to Avoid Estate Planning Logjam in 2025

[John Manganaro, ThinkAdvisor]