Paul H. Roskoph Professional Corporation The Perfect Storm May 2012 To all my readers: I received today from Planned Giving Design Center, a legal source to which I subscribe, the article on the Perfect Storm of the expiration of the Bush Tax Cuts, due to expire December 31, 2012. It is not a simple read and can hardly be classified as tax planning 101; perhaps 747 if you are planning to be an "ex pat" to escape our Congressional inaction and tax law chaos. But it is readable and you can take the next several months to digest it while I take a planned break in the monthly articles. I may add some during the summer, but there are enough issues in this article for you to consider. It is unlikely Congress will act before the elections, and perhaps not until next year. Clearly, they will do something, as "nothing" seems to be an unlikely option. There is a message that, as an advisor, I take this opportunity to share. Nearly everyone is affected by this year’s law and its likely demise into some other form next year. I encourage everyone to seek guidance on your own planning options, uncertain as they may be. Those with accumulated wealth should carefully consider gifts to the grandchildren to take advantage of the extraordinary exemption from the penalty generation skipping transfer tax. Assets in trust for the grandchild or grandchildren, with great flexibility to the trustee, seems to be the most popular "action item" for my clients. Here's the link The Perfect Storm: Prospective Expiration of the Bush Tax Cuts In December of 2010, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the "2010 Tax Act"), and which otherwise would have "sunsetted" as of January 1, 2011. Under the 2010 Tax Act, the Bush tax cuts were extended for two years and modifications were made to the estate, gift, and generation-skipping transfer taxes. These extensions and modification end on December 31, 2012. In this must read paper, Leon C. LaBrecque, JD, CPA, CFP®, CFA provides an overview of the ramifications of the expiration of the cuts and the corresponding problems and planning considerations for individuals and nonprofit institutions. - read more.