As 2021 comes to an end, business owners and individuals are seeking opportunities to maximize their savings through year-end tax planning. This webinar session will help you navigate the many complexities, obstacles, and impending tax landscape changes that the 2021 tax year brings to the table and what 2022 has in store.

1. December 8, 2021
High Net Worth Webinar Series
Growing Wealth & Preserving Your
Legacy
Tax Planning and
Update for 2022

2. Welcome
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• A Few Keys to Getting Started…
o Depending on the length of this session, you will be eligible for up to 1 CPE credit for participation.
o You must reply to at least 3 polling questions to confirm your participation to receive the full
credit.
o You are in listening mode only and today’s session is being recorded.
o You will have the opportunity to submit questions to our presenter by typing your questions into
the Q&A pane from the control panel.
o Please complete the electronic course at the end of the webinar.

3. Our Presenters
Partner & High Net Worth
Practice Leader
Patrick Daly
Partner
Mary Delman
Partner
Ronald Hegt
Director
PJ Manchanda

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General Overview of the
N ew Legislat ion
Es t a t e Pla nning U pda t e
Year- End Tax Planning
St ra t e gie s
Quest ion & A nsw ers
Agenda

5. Polling Question #1
Are you interested in receiving CPE?
a. Yes
b. No
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6. into
GENERAL
OVERVIEW
OF THE NEW
LEGISLATION
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7. into
2021 Tax Legislation Update
Summary
• Legislation Passed
o Consolidated Appropriations Act of 2021-signed 11/28/2020
o American Rescue Plan Act-signed 3/11/2021
o Infrastructure and Investment and Jobs Act-signed 11/15/2021
• What’s on the Front (?) Burner
o Build Back Better Bill
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8. into
Consolidated Appropriations Act
• Extended CARES Act employer credit for paid sick and family leave to eligible
wages paid through 3/31/21; (more later)
• Extended CARES Act Employee Retention Credit to 6/30/21 (more later);
• Codified tax deductibility of PPP related expenses reversing IRS policy;
• IRS changed rules related to timing of PPP forgiveness T/E income
• Extended 100% cash charitable contribution limit through 2021;
• Increased business meals deduction to 100% for meals provided at a restaurant
for 2021 and 2022
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9. into
American Rescue Plan Act of 2021
• Provided third round of Stimulus checks-treated as 2021 refundable credit;
• Extended credit for paid family leave and sick pay to 9/30/21 and raises eligible
amounts;
• Extends Employee Retention Credit to 12/31/21(less later)
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10. into
Infrastructure Investment and
Jobs Act of 2021
• Reduces the eligible period for employee retention credit to 9/30/21
• Cryptocurrency reporting extended to brokers to mirror current reporting
standards for securities brokers beginning in 2023
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11. into
Tax Highlights of Build Back Better
Bill
• Individual Proposals
o 5% tax surcharge on MAGI over $10 million ($5 million Married Separate; $200,000
fiduciaries)
o Additional 3% on MAGI over $25 million ($12,.5 million and $500,000)
• NIIT would apply to high income taxpayers ($500,000 MFJ; $250,000 MFS;
$400,000 all others) on all investment income, gains and business income
regardless of material participation.
o Target-S Corps and LLC income not already subject to NIIT or SE
• Excess Business Loss limitation would be made permanent, and carryover would
remain as an EBL.
• SALT limitation would be increased to $80,000
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12. into
Tax Highlights of Build Back Better
Bill (Cont’d)
• Retirement Plan Proposals-Effective in 2029
o Prohibit annual contributions for high income taxpayers if FMV of retirement benefits
exceeds $10 million ;
o High income taxpayers would have increased RMD requirement equal to 50% of FMV of
retirement plans in excess of $10 million.
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13. into
Tax Highlights of Build Back Better
Bill (Cont’d)
• Business Proposals
o 15% AMT on C Corps with 3 year average Adjusted Financial Statement Income in excess of
$1 billion;
o Business interest expense limitations for both partnerships and S Corps would be computed
at the individual level;
• No entity level limitations
• All attributes Pass through and are aggregated at individual level
• What’s NOT in the Bill
o Estate and Gift Tax Changes
o General rate increases
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14. Polling Question #2
Would you expect more or less tax legislation in 2022?
a. More
b. Less
c. Not sure
d. Don’t care
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15. into
ESTATE
PLANNING
UPDATE
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16. Grantor Trusts vs. Non-Grantor
Trusts
• Grantor Trusts
o Take advantage of disconnect between income tax and gift tax rules
o Income tax – grantor considered owner of trust
o Gift and estate tax – completed gift and out of estate
o Sales are disregarded for income tax purposes
o Power to substitute assets
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17. Grantor Trusts vs. Non-Grantor
Trusts (Cont’d)
• Non-Grantor Trusts
o Effective way to transfer assets out of estate
o Grantor is not owner for income tax or gift tax purposes
o Asset protection
o Separate taxpayer for income tax purposes
• May be entitled to income tax deductions not permitted for individuals
o Distributions may carry out income to beneficiaries in lower tax brackets resulting in lower
taxes paid
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18. Grantor Trusts vs. Non-Grantor
Trusts (Cont’d)
• Non-Grantor Trusts – newest tax proposal
o Millionaire income tax surcharge - new surcharge on the income of millionaires.
o Individuals: 5% tax on income above $10 million (MFJ)/$5 million (MFS), and an additional
3% tax on income above $25 million (MFJ)/$12.5 million (MFS).
o Estate and Trusts: 5% tax on income above $200,000, and an additional 3% tax on income
above $500,000.
o What is income for purposes of the surcharge?
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19. Valuation Discounts
• Take advantage of valuation discounts
• Lack of marketability
• Minority interests
• Need independent qualified appraisal –
best way to ensure adequate
disclosure.
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20. Intra Family Loans
• Take advantage of low interest rates
• Provides income stream
• Fund a mortgage for children and grandchildren
• Help a child start a business
• Flexibility with the repayment structure
• Good way to shift wealth
• Must have promissory note and an interest rate equal to or greater than the AFR
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21. Make Annual Exclusion Gifts
• $15,000 per donee annual exclusion for 2021
o $30,000 per donee if married and splitting gifts
• Increase to $16,000 per donee for 2022
o $32,000 per donee if married and gift-splitting
• Outright cash gifts
• Frontload 529 Plan gifts and make election to treat gift as made ratably over
a five-year period
• 2021: $75,000/$150,000
• 2022: $80,000/$160,000
• Utilize Crummey withdrawal powers
• Unlimited exclusion for direct tuition and medical care payments
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22. Using the Federal Exemption
• $11.7 million exemption is still available
• Scheduled to decrease to $5 million (indexed for inflation) on January 1, 2026
• Make taxable gifts to use this exemption
o Aggregate taxable gifts need to be over $6 million to make use of the additional
exemption
• SLATs are still a good option
• GST – use GST exemption of $11.7 million. It will decrease to $5 million on
January 1, 2026.
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23. Make Charitable Gifts
• Gift tax deduction - dollar for dollar charitable deduction
• Income tax deduction - deductibility depends on type of gifted property
• Split-interest trusts
o CLATs
o CRUTs
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24. State Gift and Estate Planning
• Twelve states and DC currently have an estate tax
o Connecticut, District of Columbia, Hawaii, Illinois, Maine, Maryland, Massachusetts,
Minnesota, New York, Oregon, Rhode Island, Vermont, Washington
• Six states currently have an inheritance tax
o Iowa, Kentucky, Maryland, Nebraska, New Jersey, Pennsylvania
• Connecticut has a gift tax
• New York State Estate Tax:
o 2021 exemption: $5,930,000
o Top rate: 16 percent
o Lose entire benefit of exemption at $6,226,500
o No gift tax; no GST tax
o Three- year claw back for gifts
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25. Foreign Individuals
• Non-citizens not domiciled in the US are subject to federal estate and gift tax
on transfers of US situs property
• US situs property is different for gift tax and estate tax
• $60,000 estate tax exemption in 2021
• No gift tax exemption
• Estate and Gift Tax Treaties may modify rules
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26. Polling Question 3
What is the current lifetime exemption amount?
a. $15,000
b. $11,700,000
c. $11,580,000
d. $5,930,000
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27. into
YEAR END
TAX
STRATEGIES
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28. Refresher
• CARES Act of 2020- The Coronavirus Aid, Relief, and Economic Security (was enacted
into Law 2020)
• Pandemic Emergency Unemployment Compensation (PEUC) - established by the
CARES Act (Expired on September 5, 2021)
• ARP Act of 2021-The American Rescue Plan-delivering direct relief to the American
people, rescuing the American economy, and starting to beat the virus.
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29. Planning Opportunities
• Recovery Rebate Credit
o CARES Act of 2020-first two rounds of stimulus payments were provided
o Consolidated Appropriations Act (CAA)- additional $600 (subject to phase-out limitations)
o For 2021, ARP increase in child tax credit-
• $3,000 per qualifying child age 6 or older
• $3,600 per qualifying child under 6
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Eligible taxpayers who did not
receive the payments will be
able to claim them on their
2021 Tax return filed in 2022 as
“CHILD TAX CREDIT”

30. Planning Opportunities (Cont’d)
• Capital Gains
o Long-term capital gain and qualified dividend rates remain unchanged (0%, 15% and 20%)
• Holding period (Long Term vs Short Term)
• Gifting
• Loss harvesting
• OZ investments
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31. Planning Opportunities (Cont’d)
• Net Investment Income Tax (NIIT)
o Additional Tax for taxpayers with MAGI (Modified Adjusted Gross Income) of more than
$200,000 per year ($250,000 Married Filing Joint, $125,000 Married Filing Separate) may be
subject to net investment income tax.
o Key Considerations
• Electing installment sale treatment
• Selling unrealized loss positions
• Switching investments to tax exempt investments
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32. Planning Opportunities (Cont’d)
• Retirement Plans
o Maximize 401K plan contributions
o Self-Employed Retirement Plan (SEP)
o Coronavirus-related withdrawals (From IRAs, pension plan or 401K plan) during 2020
o Conversion to tax-free ROTH IRA
o Withdrawals?
o REMINDER - Required Minimum Distributions (RMDs) must be made for 2021 (previously
suspended for 2020)
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33. Standard vs. Itemized Deduction
• Standard deduction
o Increased amounts for 2021 (Married filing joint $25,100; Single and Married filing separate
$12,550)
• Itemized deduction
o Medical expenses can be deducted to the extent that expenses exceed 7.5%
o Mortgage interest (TCJA limitation on deductible interest)
• Tracking
• Paying down the mortgage (Earn tax-free and risk-free income)
• Charitable donations
o CARES Act 2020 incentives extended through end of 2021 (Cash donations to public charities
fully deductible up to 100% of Adjusted Gross Income)
o For non-itemizers-can claim up to $600 of cash contributions (Married Filing Joint) and $300
for all others
o Consider bunching donations
o Donation of appreciated stock
o Sell depreciated stock and donate the cash proceeds
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34. Qualified Charitable Distributions
(QCD)
• The QCD must come from a traditional or inherited IRA
• Beneficiary must be at least 70½
• Distribution must go directly to a qualified charity
• Donation is excluded from taxable income
• No charitable deduction can be claimed for the contribution
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35. Other Key Considerations/Final
Thoughts-
• Small business owners-claim the Employee Retention Credit (ERC)
• Defer income
• Accelerate expenses
• Home office deduction
• Acquire Assets (Section 179 Expense elections and Bonus Depreciation)
• Making deductible retirement and HSA contributions
• For Section 199A Deduction(QBI Deduction) -(complex rule)-consider to see if
independent contractors should be converted to employees (W-2 wages)
• Aggregate qualified businesses to maximize Section 199A deduction
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36. Polling Question #4
In 2021, individual taxpayers are allowed a deduction for
cash contributions to public charities up to:
a. 20% of Adjusted Gross Income
b. 30% of Adjusted Gross Income
c. 60% of Adjusted Gross Income
d. 100% of Adjusted Gross Income
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37. Questions?
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38. Thank You
For Participating!
Thank you.
“Citrin Cooperman” is the brand under which Citrin Cooperman & Company, LLP, a licensed independent CPA firm, and Citrin Cooperman
Advisors LLC serve clients’ business needs. The two firms operate as separate legal entities in an alternative practice structure. Citrin
Cooperman is an independent member of Moore North America, which is itself a regional member of Moore Global Network Limited (MGNL).