Capital Gains Tax Break- Help for the Elderly

Estate planning and tax planning should go hand-in-hand. There’s a new tax break that certain seniors can take advantage of now that will only last between 2008 and 2010. People in the 10 and 15 percent tax brackets (the lowest two tax brackets) will pay zero percent in capital gains tax on the sale of their assets, including, but not limited to, stocks, bonds and investment real estate between 2008 and 2010. People who may wish to take advantage of this tax break would be adult children who help support their low-income parents, and seniors who help their adult children. The assets can be gifted to a person in the lowest two tax brackets and that person can then sell the gifted asset and not pay capital gains. Also, remember that a person can give away $12,000 to a single person per year free of gift tax which by keeping within the $12,000 limit there is another tax savings by avoiding the gift tax.

Susan H. Confair, who is part of Reager & Adler’s Transaction Group contributed this article. She holds a B.S. in Business Administration from West Virginia University and a J.D. from West Virginia University College of Law. Susan’s practice focuses on all aspects of real estate law, estate planning and elder law. She may be reached by calling (717) 763-1383 or via email at SConfair@ReagerAdlerPC.com.

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Harrisburg Magazine Readers' Choice 2011