Estate planning is usually filled with uncertainty. As usual, Congress is to blame for the situation. For the balance of 2012 the estate and gift tax exemption is set at $5.12 million but is scheduled to fall back to the 2001 rate of $ 1 million with the minimum tax rate increasing to 55%. This doesn’t set well with planners.
At the $5.12 MM limit, a husband and wife with proper planning can pass an estate of over $10 million to their heirs estate and gift tax free. If the limit falls back to $1 million, now (the balance of 2012) would be the time to consider gifting to take advantage of the higher gift tax exemption. Gifting provides the opportunity to pass on highly appreciated assets (if there are any more of these) and have them removed from your estate. It is always best to give assets away that you would expect to rise in value. Also remember that you and your spouse can give $13,000 to anyone you choose this year without reducing your lifetime gift tax exemption or having to file gift tax returns. The exclusion is scheduled to go up to $14,000 next year.
The concept of good internal controls in an organization is not new, but it is a subject that is often overlooked in small entities with few employees. There are many reasons why owners, managers, or board members of small entities, like many of those in Siskiyou County, overlook internal controls. Below, I have discussed some of the more common reasons and how you can address them.
“I have known my employees for years and know they are very trustworthy”