一本教会你“做对”题的6级阅读书 day15 passage1
Passage 1 Thinking Hard about Retirement and Death
富人如何合理避税？ 《纽约时报》
[00:03]Thinking Hard about Retirement and Death
[00:08]With 2010 a few days away, there are several tax matters
[00:13]that wealthy investors need to consider next year.
[00:18]The two at the top of the list
[00:21]are whether they should convert their taxable retirement account
[00:25]to a tax-free Roth individual retirement account(I.R.A.'s)
[00:32]and how to deal with the uncertainty over the estate tax.
[00:37]Your Money Guides
[00:38]Janine Racanelli, managing director of the Advice Lab,
[00:43]says there are ways to give money to grandchildren other than through an estate.
[00:49]Jere Doyle, wealth strategist at Bank of New York Mellon,
[00:54]said the wealthy should not get their hopes up for an end to the estate tax.
[01:00]"There is frustration due to the legislative uncertainty,"
[01:04]said Daniel Kesten, partner in the private client services group
[01:09]at Davis & Gilbert, a tax firm. "Congress had eight years to deal with this,
[01:16]but they waited until the last year
[01:19]when two wars and health care interrupted their thinking."
[01:23]That leaves the wealthy with decisions to make about
[01:28]two of the biggest financial events of their life: retirement and death.
[01:36]Roth Conversion
[01:38]Starting in 2010, there will no longer be an income limit for Roth I.R.A.'s,
[01:45]which allow people to contribute post-tax money that can appreciate tax-free.
[01:53]The income limit has been $100,000 a year for individuals.
[02:00]The question is whether converting an existing I.R.A.,
[02:04]the proceeds of which are taxed when distributed,
[02:08]into a tax-free Roth I.R.A. makes sense.
[02:13]While Congress approved the change in 2006,
[02:18]the opportunity to convert seems to come at an attractive time.
[02:23]Those whose pretax retirement accounts lost a lot of their value
[02:29]in the last two years might want to withdraw the money,
[02:33]pay tax on the amount and then put it into a Roth I.R.A.
[02:38]For wealthy investors who do not see themselves
[02:42]falling into a lower income tax group at retirement
[02:47]or who believe tax rates will rise significantly, this could be a shrewd move.
[02:55]But this requires a degree of knowledge that few showed
[02:59]with the recession that began in December 2007. "Why bother?"
[03:05]asked Tony Guernsey, head of national wealth management at Wilmington Trust.
[03:11]"Is it that much money?" He used the example of buying a Treasury bill
[03:18]with a week to maturity: you know the government will pay you back.
[03:23]But the same cannot be said for what the tax landscape
[03:27]or your wealth will look like when you retire.
[03:31]The bigger benefit may come to people who plan to pass their Roth on to heirs.
[03:38]Unlike regular retirement accounts,
[03:41]there is no minimum distribution requirement with a Roth,
[03:46]and the tax-free treatment of its assets can be passed to an heir.
[03:52]"The real benefit is coming in the estate planning aspects,"
[03:56]said Mitch Drossman, national wealth strategist
[04:00]for Bank of America private wealth management.
[04:04]"The beneficiary must take minimum distributions.
[04:09]But it will be growing tax-free and distributed tax-free."
[04:14]Estate Tax
[04:17]The elephant in the room is the estate tax.
[04:20]Congress has adjourned for the year without making any changes
[04:25]in that tax law. Now, that means the tax will disappear in 2010
[04:32]before reverting in 2011 to the old rate of 55 percent
[04:37]for estates worth more than $1 million.
[04:42]Jere Doyle stated that the wealthy should not get their hopes up
[04:46]for an end to the estate tax. He pointed out
[04:50]that an estate did not have to submit its first tax bill until nine months
[04:56]after a person's death. The Senate could wait, then,
[05:00]until the summer to decide on the estate tax and make it retroactive
[05:05]to the beginning of the year. This would wreak havoc on estate planning.
[05:11]Even if the Senate acted early in the coming year,
[05:15]it could still lead to legal challenges on the constitutionality
[05:20]of bringing back a tax that had disappeared.
[05:24]But there is a broader issue for moderately wealthy people.
[05:29]When a person dies now, the value of his or her assets gets a
[05:34]"increase in basis," which means for tax purposes the assets
[05:40]are valued on the day of death. Without an estate tax,
[05:45]this provision disappears, and the appreciated value
[05:48]is subject to capital gains tax.
[05:52]The Internal Revenue Service (I. R. S.)
[05:55]will grant a $1.3 million "artificial basis" on assets of a single person
[06:02]and $3 million for couples if the estate tax disappears.
[06:08]But on the rest of the assets, the heirs will have to determine
[06:11]what the original cost was and pay the capital gains on the appreciated amount.
[06:17]For long-held stock that has split many times,
[06:21]this could be extremely difficult.
[06:24]"If there is no estate tax in 2010,
[06:28]we have an income tax problem for a larger group of the population,"
[06:33]Mr. Kesten said. He estimated that the number of people affected
[06:38]would go from 6,000 to 60,000.
[06:43]Still, most advisers and accountants expect
[06:47]that an estate tax will be brought back,
[06:50]and this has pushed the wealthiest to find new ways to reduce its impact.
[06:56]Ms. Racanelli points out that giving money to grandchildren
[07:01]above the exemption rate is also better than leaving it to them
[07:06]through the estate. She said a person could save
[07:10]more than $500,000 in taxes on $1 million by giving the money now.
[07:18]An option to avoid gift and estate taxes is to lend money to heirs.
[07:24]The Internal Revenue Service rate for such loans in December
[07:29]is 0.69 percent for up to three years.
[07:33]The money is not subject to the higher 45 percent gift tax,
[07:39]but instead the lower 15 percent capital gains tax, Mr. Doyle said.
[07:44]If you die before the loan is repaid, however,
[07:49]the outstanding balance could be subject to income tax.
[07:54]Gift Tax Exclusion
[07:57]One of the most basic but highly effective estate tax strategies
[08:02]is the annual gift tax exclusion. The I.R.S.
[08:06]in 2009 allowed people to give up to $13,000 a year to anyone they wanted,
[08:13]tax-free. This exclusion is separate from the $1 million lifetime exemption.
[08:21]But this is something that many wealthier people overlook,
[08:25]said Phyllis Silverman, vice president and senior trust adviser
[08:30]at PNC Wealth Management.
[08:32]"They're all very busy and the idea of $13,000 per individual
[08:37]may not make an impact on their minds," she said.
[08:42]"But when they sit down with their financial adviser,
[08:47]they can see how it will lower their estate costs."
[08:52]For those with an estate subject to a 45 percent estate tax,
[08:57]each $13,000 gift will save them a large sum of money in estate tax,
[09:04]Ms Silverman said. Or consider this example:
[09:08]A married couple with a $10 million estate gives $13,000 a year each
[09:15]to six people for a decade. At the end of that time,
[09:19]they will have given $1.56 million tax-free.
[09:25]Based on the current estate tax rate,
[09:28]they will have also saved $702,000 in taxes by moving
[09:34]that money out of their estate before they die.
