Federal Tax Change Announced

Greg Bowman, CEO

Greg Bowman, CEO

Here are just a few of many headlines warning of tax hikes being contemplated:

“…61 Percent Tax on Wealth”
Tax Foundation 4/29/21

“How Estate Tax Changes Could Affect You And Your Family”
Forbes 4/09/21

“Proposal would tax gains on appreciated assets at death”
The Wall Street Journal 4/29/21

“Potential Changes to Generational Wealth Transfer Tax”
CNBC 3/13/21

“Act now – estate tax planning needed” 
Biztimes.com 3/4/21

While from a tax perspective this sounds dire, there is good news for individuals and for professionals advising clients in this area. To date, there is no proposed reduction in the estate tax exemption (i.e. there is no proposed estate tax increase). Thus, although the proposed rules to eliminate stepped-up basis for capital gains may be retroactive to January 1, 2021, the current climate provides a great opportunity for individuals and professionals advising clients on transfer taxes, to re-evaluate current estate plans. 

All of this may well mandate the need for new trusts, changes to existing trusts, and the need for a highly competent trustee. 

If your professional practice embraces the need for creative tax planning utilizing trusts for your clients, you will be addressing the question of trustee selection. A family member is usually not the best choice, considering the potential for disqualification of many trusts under the new laws. Naming Northwest Trustee & Management Services as your clients’ trustee could be your best option.

A few things to know about Northwest Trustee & Management Services:

We are a Washington State regulated trust company

  • No state income tax on trusts
  • Directed trustee statute allows for the separation of trustee functions
  • Decanting statute allows for the restructuring of many irrevocable trusts

We accept trusts that directed trustees and most large banks will not accept:

  • Complex assets such as closely held businesses, fishing fleets, 
  • timberlands, and other specialty real estate
  • Special needs trusts and litigated trusts and estates
  • Estate administration and Power of Attorney appointments

We pioneered the independent trustee model in the Northwest over 30 years ago and continue to focus exclusively on fiduciary administration with no conflicts of interest for your clients and a strong, dedicated staff with a willingness to provide unique, personalized concierge services to your clients.

How we love to help:

  • Free 30-minute “what does a trustee do?” session with your clients
  • Review a trust document or estate plan (irrespective of whether we are named)
  • Listen to your clients’ needs and help brainstorm possible solutions

Please call me directly, or our New Client Services Manager, Krista Fitzpatrick, to schedule a call.

June 2021