2017 is the final year for a potentially large tax that can affect certain New Jersey households. New Jersey is one of just fifteen states that still have an estate tax (and one of just two with an inheritance tax as well). The New Jersey estate tax is levied on assets exceeding $2,000,000. This includes [...]
Federal Gift Tax rules are complex and often create a fair amount of confusion (State Gift Tax rules will be examined in a future article). The most counterintuitive aspect of the Gift Tax is that the tax is applied to the donor (the giver of the gift), rather than to the donee (the recipient of [...]
Estate Planning and How It Impacts All of Us Part II – Revocable Living Trusts, Wills and Living Wills, what do I need?
Revocable Living Trusts, Wills and Living Wills are terms that are often confused. From the outset, it is important to understand the objective of each of these instruments as well as their advantages and limitations. A Revocable Living Trust (or Living Trust) is a document that is created by an individual, known as the trust [...]
Estate Planning and its Impact on all of us Part I – What is an estate and what planning is involved?
The term “estate” often conjures up images of considerable amounts of wealth and large pieces of property left over by the rich and famous. This often leads to the assumption that estate planning has nothing to do with average individuals. In fact however, estate is a term that encompasses all property and rights that a [...]
Need a short-duration loan? How about borrowing from your IRA? Technically speaking, one is not allowed to borrow from an IRA account under any circumstances. However, there is a workaround that is available if certain rules are carefully observed. Under section 408(d)(3) of the Internal Revenue Code, it states that a tax free withdrawal can [...]
Put your retirement to work for you now! Part II – Using retirement funding to provide short term liquidity.
When one requires a large amount of money quickly, (e.g. making a wedding, sending a child to seminary etc.), there are many financing options available. Retirement fund loans are not the obvious choice, but they can offer attractive benefits that other loan arrangements do not. One of the lesser known perks of 401(k) plans, is [...]
Put your retirement to work for you now! Part I – Reducing current income tax liability by funding your retirement.
Retirement planning may not top everyone’s list of things to take care of this year; however, the significant and readily available tax savings warrant a closer look. Taking advantage of these opportunities will reduce current tax obligations while preparing for a better retirement in the future. Working individuals are generally divided between employees and the [...]
Using the charitable itemized deduction is a popular method of reducing personal tax liability. Philanthropic motivation, coupled with the available significant tax deductions, create the possibility for discounted large gifts to charitable organizations. As tax planning and charitable gifting are asynchronous, it is often the case that a donor will seek to accelerate gifting [...]
Trenton has just passed a comprehensive tax bill that will have a significant effect on everyone living in the state of New Jersey. From the price of gasoline to sales and estate taxes the changes are broad and deserve a few minutes of attention for better understanding. What follows is a comprehensive summary of the [...]
Foreign Assets – Compliance with U.S. Disclosure Requirements Part 3: Foreign Asset Disclosure – Form 8938
The newest addition to the foreign asset disclosure requirements for U.S. individuals is Form 8938 (Statement of Specified Foreign Financial Assets). This form, which accompanies the annual (and more familiar) Form 1040, was first required for the 2011 tax year. The minimum quantity of Foreign Assets an individual must possess to require this filing, varies [...]