This article was originally posted on Steve Leimberg’s Business Entities Email Newsletter Archive Message #3115.
There is no way to determine which, if any, of the Biden proposals will be enacted, and if so, when. It is clear that the Democrats have been proposing similar harsh tax changes for a long time, and at some point, some or many of these proposals may be enacted. With that risk, practitioners should consider advising wealthy clients to plan now. Clients need to understand that while plans should be structured to be as flexible as possible there are risks to incorporating the provisions necessary to achieve that flexibility). Any asset transfers, presumably to trusts, should be planned to give clients sufficient access so that they aren’t harmed economically. Reiterate to clients that regardless of the tax changes that may occur, they may benefit from asset protection benefits. So, clients should plan while they can. The planning techniques practitioners have gotten accustomed to using might not be available in the near future.
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