Pending regulations may impact estate planning

Namrita Notani, an attorney at Spencer Fane, recently explored the significant impact pending legislation may have on estate planning professionals and their clients. Namrita discusses the proposed changes in the American Housing and Economic Mobility Act of 2024. She highlights the tax-related challenges and opportunities in areas such as estate planning and charitable giving, particularly for individuals of high net worth. Given the breadth of these proposed changes, estate-planning attorneys must proactively advise clients on strategies to mitigate potential tax liabilities,” she said. She outlines potential action items, including maximizing annual exclusion gifts, accelerating charitable contributions, and reviewing and restructuring trusts. At Spencer Fane, Namrita’s practice focuses on helping clients develop effective and beneficial wills, testaments, trusts, powers of attorney, and other related estate planning documents. She prioritizes plans that minimize, defer, and eliminate taxes.

Pending estate planning changes

She also ensures the protection and disposition of all assets through easy-to-understand advice. This gives clients a clear picture of their tax, trust, estate, and business succession plans. The IRS adjusts tax brackets and other tax-related amounts for inflation annually. Based on data from the Bureau of Labor Statistics through August 2024, experts have projected adjustments to some relevant estate planning amounts for 2025. One significant update is that clients who have exhausted their current estate tax exclusion amounts can transfer an additional $380,000 of wealth without incurring any federal transfer tax. For married clients, this amount is $760,000. It is important to note that absent future legislation, the estate tax basic exclusion amount will be cut roughly in half beginning in 2026. Therefore, proactive planning now is even more critical. The official 2025 adjustments will likely be published in late October or early November.