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State Premium Tax PlanningState Premium Tax Planning
The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (2010 Tax Act) brought about an increase in the gift, estate and generation-skipping transfer (GST) tax exemptions to $5 million each.1 Many clients are considering creating new trusts or adding to existing trusts to take advantage of these increases.2 Some clients are also considering purchasing large amounts of insurance
Al W. King III & Pierce H. McDowell III
The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (2010 Tax Act) brought about an increase in the gift, estate and generation-skipping transfer (GST) tax exemptions to $5 million each.1 Many clients are considering creating new trusts or adding to existing trusts to take advantage of these increases.2 Some clients are also considering purchasing large amounts of insurance in trusts as a result of these increased exemptions. But with these large amounts of insurance come high insurance premiums, which could result in extremely large state premium taxes being due. Trusts and limited liability companies (LLCs) created in certain low premium tax states can be an excelle...
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