Wealth Preservation, Trusts and Estates

David M. Frees III on What To Do About The Federal Estate Tax Problem

If you are confused about why Congress allowed the federal estate tax to lapse and then failed to enact a new law - leaving Americans in an estate planning limbo, then you are not alone. Most political commentators, trust and estate lawyer, and even the past federal reserve chairman Paul Volcker have weighed in on this issue by condemning congressional inaction.

Bur Volcker recently said what many Americans have been thinking - that this situation is “crazy.” For more on Volcker’s remarks on Congress and the federal estate tax, click here.

So what is a confused citizen to do? Well first, read a few articles on the federal estate tax so that you are more familiar with this crazy situation. Then, you’ll probably want to review your existing plan with your lawyer to make sure that it works now -when there is no tax, as well as next year when the tax returns with a vengeance.

Being an informed consumer of legal, tax, and estate planning advice is more important than ever.

David M Frees III
Chairman: Trust, Estates, and Wealth Preservation Section
Unruh, Turner, Burke and Frees
Malvern, Phoenixville, and West Chester Pennsylvania

610-933-8069

If you are a Pennsylvania resident and want to update your estate planning, protect your heirs, or deal with the uncertainty of the federal estate tax please call 610-933-8069 and mention code FREES2010 for a complimentary phone or in person consultation.

David M. Frees III on Required Minimum Distributions and 2009 Deductions You Can Still Get

Tax Deductions and Required Minimum Distributions for 2009 and 2010 - Estate Planning Means Good Tax Planning

If you took advantage of the one year exception last year, you may not have taken a required minimum distribution from your IRA or 401(k). However, as our friend Doug MacGray reminds us in his news letter MacGray Matters, that the RMD is back.

Doug also notes that Haiti earthquake donations made this month can still be taken on your 2009 tax return.

First, the issue of required minimum distributions.

THE RMD is back: If you hold money in a traditional IRA, and you are older than 70 ½, then beginning this year (2010), you must once again withdraw your annual Required Minimum Distribution. Of course, when you make these withdraws, you are subject to tax (on traditional and not Roth IRAs).

The I.R.S. suspended the RMD rule in 2009 due to the large loses many taxpayers experienced. That was great for last year, but the RMD is back.

As your tax preparer will remind you, the RMD is determined by your age and the market value of your IRA. So if you’re 70 1/2 or above, contact your investment advisers soon to plan for this withdraw and the tax issue that will result in on your 2010 return.

Tax deductions still available for 2009:

Just as a reminder, President Obama recently signed into law an act which allows taxpayers to claim a charitable deduction for tax year 2009 for cash donations made for the relief of victims in areas affected by the January 12, 2010 earthquake in Haiti. These contributions must be made before March 1. Ask your adviser for more specifics about the eligible recipients.

Thanks to our friend Doug MacGray
Principal, Senior Vice President Financial Planning
300 Conshohocken State Road, Suite 670 | W. Conshohocken, PA 19428 | (610) 783-4265 (direct)

Hope that you had a great snow weekend and here’s to a safe return to work.
Be well.

David M. Frees III, Esquire
For an estate planning consultation or for advice concerning an estate or trust, call 610-933-8069. Mention OFFER DMFREES2010 for your free consultation.

Unruh, Turner, Burke and Frees maintains offices in Malvern, Phoenixville, and West Chester serving Devon, Berwyn, Exton, and the Western Main Line

dfrees@utbf.com

David M. Frees III on a Asset Protection

It is that time of year when the IRS publishes warnings about tax fraud to try to keep the tax payers honest. And, it is also that time of year, when faced with increasing tax liabilities, many tax payers update their estate and asset protection planning and look for opportunities for tax savings as well as the opportunity to shelter assets from frivolous lawsuits.

However, as many of the articles below will confirm, there are unscrupulous “salesmen” who tempt tax payers with tax devices and “asset protective” investments that are just too good to be true.

So, how do you know of that proposed tax advantaged investment is a scam, borderline or flat out illegal?

Here are a series of articles that give you some of the warning signs of a dangerous sales pitch. The danger signs include, but are not limited to: tax investments that radically change your return ( a red flag to the IRS as well), investments where you are prohibited from getting a second opinion by a non disclosure agreement, returns or results that are simply too good to be true, and many more.

In any case, be sure that you really know the law, get good advice, and do your due diligence before investing in any type of investment promising tax results that are too good to be true.

Warning Signs of Bad Tax Investments from the New York Times

The Eight Warning Signs of Tax Fraud in Your Asset Protection