Close

Lipson Neilson – Law Firm in Bloomfield Hills, Michigan

3910 Telegraph Road
Suite 200
Bloomfield Hills, MI 48302

Phone:
(248) 593-5000

Fax:
(248) 593-5040

More Details

Lipson Neilson – Law Firm in Las Vegas, Nevada

9900 Covington Cross Drive
Suite 120
Las Vegas, NV 89144

Phone:
(702) 382-1500

Fax:
(702) 382-1512

More Details

Lipson Neilson – Law Firm in Phoenix, Arizona

5343 N. 16th Street
Suite 140
Phoenix, AZ 85016

Phone:
(602) 626-8888

Fax:
(602) 626-5588

More Details

Lipson Neilson – Law Office in Reno, Nevada

1 E. Liberty Street
Suite 600
Reno, NV 89501

Phone:
(775) 420-1197

Fax:
(702) 382-1512

More Details

Lipson Neilson – Law Office in Colorado Springs, Colorado

102 S. Tejon Street
Suite 1100
Colorado Springs, CO 80903

Phone:
(720) 601-8008

Fax:
(702) 382-1512

More Details

Close

Or Search By:

Sandra D. Glazier Contributes to Wealth Management Article on “Stepped-Up Basis on Death” Tax Code

In a Wealth Management Magazine article titled “Senate Democrats Are Coming for Stepped-Up Basis at Death”, that discusses why estate planners have mixed feelings about the proposed Sensible Taxation and Equity Promotion (STEP) Act, Lipson Neilson Shareholder Sandra D. Glazier is quoted in a section called “Comments From the Experts.”

Sandra D. Glazier’s discussion in the article:

The 99.5 Percent Act proposes an increase in the estate tax rates to historically high levels (up to 65%), thereby penalizing those who accumulate wealth. Taxation needs to be fair and shouldn’t penalize any particular class of individuals (wealthy or poor), but seek to reach a balanced approach.

This proposal would require individuals to go back to the days of tracking basis. For those of us who remember 2010, the ability to track basis on assets can often be difficult especially after an individual has died (and for assets accumulated over generations by families, it may be near impossible). This is why paying tax based upon the value of the assets that restarted the basis valuation makes practical sense.

For the vast majority of estates of individuals who died in 2010, trying to evaluate using the then limited adjustment to basis, as opposed to applying the $5 million exemption, was such a nightmare (and for some darn near impossible), all but persons like George Steinbrenner, utilized the exemption/step-up basis regime, as opposed to carryover basis.

It appears that the capital gain tax would be imposed at the time of death, even if assets aren’t liquidated and the gain actually realized. Even with the proposed ability to defer the gain on non-publicly traded assets, this could create a whole other set of problems in terms of the need to liquidate assets in order to come up with the taxes on the capital gain (as well as the estate taxes), as opposed to simply retaining a carry-over basis that would require payment of the tax at the time of liquidation.

It also appears that there would be an imputed transfer every 21 years for assets held in trust under the STEP Act. Many families hold assets in trust for myriad reasons (for example, to protect special needs children, protect the ability of family-run businesses to remain in the family). The 99.5 Percent Act (as I understand it) would in essence impose a 50-year federal rule against perpetuities, which would have the effect of requiring distributions out of trust or an inclusion ratio of 1 at that time, which would appear to make the need for an additional imposition of capital gains taxes every 21 years unnecessary (and could perhaps result in the imposition of multiple tiers of taxation on the same assets).

It seems that these proposals go too far and risk creating a record-keeping (and tax) burden that few will be able to meet.

Sandra D. Glazier, Equity Shareholder in Lipson Neilson PC, in its Bloomfield Hills, Michigan office. The firm has offices in Michigan, Nevada, Arizona, and Colorado, and provides counsel and representation to clients across the country.

We Look Forward To Connecting With You

  • Lipson Neilson P.C. publishes this website to convey general information and not for the purpose of providing legal advice. This Web site and its contents do not create an attorney-client or any other relationship between Lipson Neilson P.C. and any visitor to the Web site. Electronic mail (“e-mail”) sent to Lipson Neilson P.C. or any of its lawyers will not create an attorney-client relationship.
    * Checkbox Required
  • This field is for validation purposes and should be left unchanged.

The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.

The verdicts and settlements listed on this site are intended to be representative of cases handled by Lipson Neilson. These listings are not a guarantee or prediction of the outcome of any other claims.

attorneysbarsdownloadlocationpractice