As the turmoil on Wall Street wreaks havoc on the portfolios of America's wealthy, advisors will be gathering in Orlando, Fla., for the pre-eminent convention in estate planning: the Heckerling Institute's annual conference, which takes place January 12-16. The event couldn't have come at a better time, since the market downturn has enabled individuals to transfer wealth more cheaply than ever before, creating a window of opportunity unlikely to be seen again in this lifetime, experts say.

"We could look back on this as a historic opportunity for people," says Alan F. Rothschild Jr., an attorney with Hatcher, Stubbs, Land, Hollis & Rothschild in Columbus, Ga.

If conference attendance is any indication, planners want to learn more about how to exploit the unique opportunities that exist today. Attendance is up this year by about 100, according to Tina Portuondo, the Heckerling Institute's director.

"I wasn't expecting that," she says.

While the conference, put on by the University of Miami's School of Law, will cover a variety of topics-from the typical estate planning problems to planning for children with special needs-the focus is expected to be on the advantages to be gained by the current economic downturn. Speaker Jo Ann Engelhardt, a managing director at Bessemer Trust, says estate planners will be shown how to make lemonade out of lemons.

"Every economic climate benefits individuals in some positions and hurts some in others," she says, citing low interest rates as an example. "There are certain estate planning techniques that are very beneficial in a low-interest-rate environment."

In one panel entitled, "If I Knew Then What I Know Now: Practical Solutions to Recurring Estate Planning Problems," Engelhardt and other speakers will highlight some of the difficulties caused by the current economic climate. Trusts, for example, may no longer produce sufficient income. The family vacation home may become a bone of contention if one child who has fallen on hard times wants to sell it while his siblings prefer to retain it. The family business may no longer qualify for an estate tax deferral.

But opportunity is also arising, in part from the fact that asset values are depressed, making it a good time to expose large gifts to the federal estate tax. Indeed, a number of Heckerling's speakers will focus on the benefits of the grantor-retained annuity trust (GRAT)-an irrevocable trust into which a person places assets while retaining the right to receive fixed payments, or an annuity, that is presumably generated by those assets. At termination, all the accumulated income, principal and appreciation in excess of required annuity payments passes to children, either outright or in trust.

The advantage of a GRAT is that the gift tax is paid on the value of the assets that are put into the trust, not how much they're worth years later, when the annuity terminates. Moreover, the Internal Revenue Service only taxes the amount of money expected to be left in the trust once the annuity payments have been made (a predetermined interest rate determines the payment amounts). Those creating GRATs now can put depressed assets into the trust and calculate the tax payment based on current asset values. When the economy picks up and asset values rise, the children will received the additional value free of estate taxes.

An added benefit to the current economic environment is that with interest rates low, the IRS' formulas for calculating how much an annuity must pay out are a lot lower, leaving a greater percentage of the assets remaining in the trust that can then be passed on to one's children. In June of this year, for instance, the rate was 3.8%, while in August of last year, the rate was 6.2%.

If GRATs have great potential for wealth transfer right now, their precursors, called grantor-retained income trusts, or GRITs, were once considered even better. These instruments say simply that income from the trust can go to the grantor of the trust while the trust is in place. So if property that generates no income were put into the trust, the children would get more wealth transferred to them and very little would be subject to the gift tax.

Congress has outlawed GRITs for use by family members, however, because it viewed them as abusive. Unmarried couples, however, can still use GRITs. This represents one of the advantages of being unwed for the purposes of estate planning, says Joshua S. Rubenstein, a partner at Katten Muchin Rosenman LLP who will be giving a talk at the Heckerling conference entitled, "Estate Planning for Unmarried Couples: Detriment or Opportunity." While unmarried couples may not be eligible for some of the basic estate planning strategies used by those who are married-the biggest being the ability to pass wealth between spouses tax-free-there are a lot of estate tax loopholes that were closed for married couples that remain open for those who haven't tied the knot, Rubenstein says. An economic environment with depressed asset values can give these transactions a bit more juice.

But falling asset values cut both ways. While they benefit individuals who want to transfer assets now, those people who made significant wealth transfers six months ago-and who will be taxed according to the assets' values at that point-are finding those assets have gone down in value. Like people who now hold mortgages that are higher than their home's value, some wealthy individuals may have to pay a high gift tax on what was once a valuable asset only to find the asset is now worth a lot less. Moreover, as asset values fall, so, too, does one's net worth.

From a client's perspective, the good news of the depressed economic times is that key assets can be assessed at below their market value, say conference speakers. "But the trade-off is that someone [who was] worth $50 million and is now worth $20 million doesn't feel like giving property away," Rubenstein says.

This issue is likely to come up in the "Recent Developments" panel on the opening day of the conference. Dennis Belcher, a partner at McGuire Woods LLP in Richmond, Va., and one of the panel's three speakers, says he has been hearing from colleagues that a lot of clients are unhappy about those transfers now.

"We will be talking about how the significant changes in the valuation of assets presents challenges to our clients, and whether those clients feel as comfortable as they did before," Belcher says. "Are they more interested in asset preservation now, as opposed to estate planning? That will be one of the main challenges presented."

Belcher says the net worth of some of his clients may have gone down as much as 20%. Their attitude toward estate planning is likely to depend on where they fall in the wealth spectrum: Those with less than, say, $20 million in assets probably want to put estate planning on hold right now while those with more assets probably want to take advantage of the opportunities created by the current economic climate.

Jonathan Rikoon, a partner with Debevoise & Plimpton LLP in New York was supposed to give a talk on how private equity and hedge fund managers could most effectively transfer their "carried interest" income to their children. But with so many alternative investment funds fighting for survival, Rikoon says he may now focus on exit strategies as well-that is, he may tell these managers how they can unwind some of the estate planning structures they set up in the past.

"After you give something away, you want to make sure there's enough left for you," Rikoon says. "Now, I ask my clients, do you really want to do this?"

While Rikoon agrees with his fellow speakers that the economic downturn has created opportunities to transfer depressed assets more cheaply, alternative investment managers may have to put their estate planning goals on the sidelines for now if they want to assure they have enough current income to live comfortably.

"The primary economic reason they're doing this is to get rich," Rikoon says. "But if they're just getting into the field, the safest thing for them to do is set up their fund first and see how it does before worrying too much about estate planning. That's not necessarily the conclusion one would have reached a few years ago."

The Heckerling conference, which began 43 years ago as a gathering of about 300 estate attorneys, now has about 3,000 attendees, representing every facet of estate planning, from the legal and tax side to the investment side-though 70% of the participants are lawyers.

Portuondo says the program is planned months in advance, but always has some flexibility built into it to address any changes to the estate tax, especially those that come in the wake of a presidential election. Some of the speakers are apparently modifying their talks to reflect the current economic climate as well.

"The speakers are nimble enough to tailor their presentations," she says.

Among the other topics likely to be discussed at the conference are how to plan for changes to estate tax law that may result from the new administration of President-elect Barack Obama and greater Democratic control of Congress. Among the questions: Should people take action now, accelerating income or taking capital gains before the tax laws change? Or should they wait to see what happens first, since it's not a great time to be selling assets?