(Dow Jones) The Obama administration's proposed budget calls for lots of changes that could affect your estate plans, and ignorance isn't bliss-it's foolhardy.
Some of the proposals might become reality, some might get modified, and some may never see the light of day. Still, many experts have been sounding the alarm for a while, urging all who will listen that time is running out to take advantage of some sweet, once-in-a-generation chances to save money.
Given the relatively low interest rates and transfer tax values, and some Uncle Sam-sanctioned planning techniques, there is a window of golden opportunity, according to Steve Leimberg, the publisher of Leimberg Information Services Inc. and author of "Tools and Techniques of Estate Planning."
But now that Obama has released the 2011 budget, "the window of opportunity for a number of popular and highly effective estate and financial planning techniques is rapidly closing," according to a recent Leimberg missive.
So what should you consider doing given these potential changes?
1. Tax basis consistency
Tax basis is generally the price you paid for property, plus the cost of improvements, less depreciation if applicable, according to Martin M. Shenkman, an attorney and certified public accountant.
"Tax basis is used to determine gain or loss when property is sold," said Shenkman, who has written several books, including "Living Wills & Health Care Proxies: Assuring That Your End of Life Decisions Are Respected."
"If you received property by gift, tax basis is generally the same as the person who gave it to you. This is called the 'carryover basis,'" he said. If you inherit property, the basis is generally the fair value of the property at death as reported for estate tax purposes.
Not surprisingly, he said there have been abuses. "For example, if someone gave you a gift that was worth less than the annual gift exclusion [$13,000 in 2010] no gift tax return would report the information to the IRS," he said.