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WGY Ask the Expert: Be Prepared for Tax Reforms

Each week iHeartMedia radio station, WGY, invites local experts to share their knowledge on a range of topics. Recently, they invited attorney Lou Pierro to share his biggest tips on Estate Planning.

In the first podcast, Lou and Joe discuss tax reform in Washington. Although it is not final, the elimination of income tax deductions is likely to be included in the final bill. It will affect blue states the most, which tend to have higher income taxes. Because of this, Lou recommends being proactive in your spending habits. Take advantage of the deductions by the end of the year and pre-pay property taxes and mortgage. 

In the second podcast, Lou talks about the misconceptions with Medicare. Many seniors rely on Medicare, but are unaware of the gaps in coverage that it can leave. Medicare pays for no long-term care, so it’s important that you plan to protect yourself and assets as you get older. Ask yourself: what is my liability? Then, plan to anticipate that risk. Examples of this are setting up a trust, so that if you do need to go on Medicaid, your assets will be protected, and you can avoid the ‘spend down’.

Call (518) 459-2100 today to set up a free consultation and learn more!

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GOP Tax Plan Could Deal Blow to Seniors Paying for Long-Term Care

The tax plan put forward by the Republican-led House of Representatives would eliminate many current deductions, and getting rid of one of them in particular could deal a serious financial blow to seniors and individuals with disabilities. The plan proposes eliminating the medical expense deduction, a change that will especially affect those needing long-term care.

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Major Changes to New York State Estate, Gift & Generation Skipping Tranfer Taxes

With the passage of the New York State Budget for 2014-2015 substantive changes were made to the New York State Transfer Tax System (Estate, Gift & Generation Skipping Transfer Taxes). Under prior law, $1,000,000 was excluded from tax under the New York Exemption. Effective April 1, 2014, the new legislation imposes a tax on a decedent’s entire taxable estate, but allows a credit, known as the “Applicable Credit Amount”, against the tax imposed. For decedent’s dying between April 1, 2014 and March 31, 2015, the New York exemption (called the “Basic Exclusion Amount”) is $2,062,500. 

The new State Exclusion Amount is phased in over the next five years and will ultimately, as of January 1, 2019, approximate the Federal Applicable Exclusion Amount. As noted above, the new legislation features a generous credit which essentially eliminates the New York Estate Tax for estates which do not exceed the State Basic Exclusion Amount. However, the Applicable Credit Amount is rapidly phased out for decedents with taxable estates in excess of the new State Basic Exclusion Amount.

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