The State of Estate Planning – 2017

You probably feel as if the field of Estate Planning is in turmoil right now – uncertainty about income taxes, estate taxes and wealth transfer solutions seems so disruptive that Larry Brody, a widely respected estate planning practitioner, has titled an upcoming  presentation:  “What the Hell Do We Do Now?”confusion1

Is it really that bad?  Well, here are links to two excellent and recent AALU publications that may help answer that question.

The takeaways, first from the Survey: “Even in the face of major tax reform, clients and their advisors should remain optimistic and steadfast in their approach to implementing life insurance and legacy planning. Flexible, multi-faceted planning that can address both practical and tax issues is at a premium. Life insurance remains an ideal solution because of: (1) its unique attributes (instant, mortality-based liquidity and cash accumulation and death benefit payments on a tax sensitive basis) and (2) its ability to serve many critical objectives (tax, retirement, and liquidity planning, investment management and diversification, and family security).”

And from the Heckerling Institute: “Overall, Heckerling presenters were optimistic regarding the current planning environment, particularly as this is not the first time that the estate and life insurance industry has dealt with the prospect or passage of major tax changes (e.g., 2010 and 2012). Many planning approaches, like trusts, estate freezes, and life insurance, are inherently flexible and multi-faceted, and tax changes can actually enhance different structuring options and benefits. Accordingly, this environment should trigger thorough audits of client plans and open the door for a dialogue between allied professionals and clients, with interest in life insurance products continuing as both a solution to practical needs and as a complement to other planning approaches.”

We encourage you to read through both the Survey and the Heckerling Institute summary to help clear up some of the hyperbole and confusion that often arises when there’s talk of major tax policy changes.

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If you’re like us, you’ll realize that 2017 will continue to offer plenty of new opportunities for planning and insurance professionals, no matter which way the wind blows.