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June 2012 Archives

Estate and Gift Tax Changes for 2013

The estates of every U.S. citizen are subject to federal estate tax, but not every estate is required to pay the tax if the amount of the estate is less than the federal estate and gift tax exemption. In 2012, if the estate of a decedent has a net value of $5 million or less, then the estate will pass to the decedent's heirs free from federal estate taxes. The tax exemption also allows individuals to make gifts during their lifetime of up to $5 million. In addition, if the decedent was married on the date of death, and did not use all of the available exemption, the surviving spouse could add any unused exemption to his or her own up to an additional $5 million enabling the survivor to transfer up to $10 million tax free. Use of this "portability" feature can save the surviving spouse a million dollars or more in taxes. There is a great deal of uncertainty, however, when it comes to estate tax planning since the current law is due to expire on December 31 of this year. If Congress does not act at all, the estate tax exemption will drop to $1 million and the top tax rate would increase from 35% to 55%. In its 2013 budget proposal, the White House has proposed reducing the estate tax exemption level as well as the top tax rate that would be applied. The exemption would go from $5 million to $3.5 million and the tax rate would increase from 35% to 55%. While changes to federal estate and gift taxes can create a great deal of anxiety, the current situation provides a huge opportunity for individuals with business or other highly appraised assets, to make significant transfers of wealth, tax free. If you have been thinking about business succession planning, or making gifts of real estate or other assets to the next generation, now is the time to talk with an estate planning attorney who can assist you in implementing a strategy that takes advantage of the tax laws before they change. To create or amend your estate plan with these pending changes in mind, please call our office to schedule an appointment with one of our attorneys who are knowledgeable in the areas of trusts and estates, tax, and business law.

EEOC updates

While Title VII of the Civil Rights Act of 1964, as amended does not prohibit an employer from requiring that an employee or applicant seeking employment provide information about arrests and convictions, use of such information in employment decisions may violate the prohibition against discrimination. The EEOC has recently issued updated guidance to employers on the use of these records when making employment decisions. (This information will be available on the EEOC's website at Whether the employer searches an individual's criminal background itself or relies on a third party agency to provide information, in general, employers are interested in this information because of increased concern about workplace violence, liability for negligent hiring, theft and fraud. While having a criminal record is not a protected category under Title VII like race, color, religion sex and national origin are, the manner in which the employer uses the record may become part of a claim of employment discrimination based on those protected categories. For instance, if the employer makes derogatory statements about an employee or applicant's protected group, this might be used as evidence of bias and that the bias played a role in an employment decision. Additionally, if the employer is inconsistent in its request or use of the criminal background information by asking for it more often from individuals with certain racial backgrounds or allowing some employees or applicants to explain the information and not others, the inconsistency can be evidence of employment discrimination either in the hiring or evaluation process. Employers are advised to review their policies and practices to determine whether they have a greater impact on a group protected by Title VII than other employee's or applicants. Employers should train managers and those who make employment-related decisions on best practices when making such decisions. A narrowly tailored written policy and procedure for reviewing applications for employment should be developed, and managers need to be trained on the implementation of such policies and procedures so that they are consistent with Title VII. Employers are reminded that, if they collect applicants' and employees' criminal records, to keep this information confidential.

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The Busiel Mill
One Mill Plaza
Laconia, NH 03246

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40 Canal Street
Lancaster, NH 03584

Phone: 603-788-2410
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59 North Park Street
Lebanon, NH 03766

Phone: 603-448-3080
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18 Union Street
Wolfeboro, NH 03894

Phone: 603-569-2977
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