On August 25, 2010, Forbes.com published Five Ways To Freeze Out Uncle Sam, by Deborah L. Jacobs.
Five strategies. Jacobs explains five strategies that take advantage of low interest rates to “freeze out uncle Sam”:
- Lend money.
- Sell assets.
- Set up new GRATs.
- Revisit existing GRATs.
- Benefit charity, then family.
Estate tax freeze. Jacobs explains that “the most compelling reason” to use these strategies “is the prospect of what’s called an estate tax freeze.” As Jacobs explains in the article, an estate tax freeze accomplishes two objectives: (1) it removes the asset from an estate, and (2) it removes any subsequent increase in value from an estate.
Little or no gift tax. In addition to freezing the value of an estate, the strategies that Jacobs describes would require paying “little or no gift-tax.”
Asking your adviser. The benefit of this article is that it educates the reader using plain English. It empowers readers to (1) realize that there are excellent planning opportunities available today, (2) go to their advisers, and (3) ask them the right questions.
More information. Like this article, Jacobs’s book on estate planning empowers readers. One widely praised feature of the book is the checklists at the end of chapters. Estate Planning Smarts: A Practical, User-Friendly, Action-Oriented Guide has another virtue while the estate tax is in flux: Jacobs issues updates that can be downloaded from the book's Web site www.estateplanningsmarts.com, and tweets at http://twitter.com/djworking.