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November 11, 2023 Market Update

The U.S. stock market rose for a second week through the close of trading on Friday, November 11th.  The S&P 500 Index gained 1.3%, building on the previous week’s surge.  The rally lifted the equities benchmark to its highest level in nearly two months and pushed it through its recent trading range. 

The bond market was mostly steady after its recent rally.  The U.S. 10-year Treasury yield ticked up to end the week at 4.61%, a middling level relative to the range that’s prevailed since early October.

As 2023 winds down to its final weeks, it’s a good time to consider upcoming changes to the federal transfer tax system.  This year, there’s good news and bad.  Let’s start with the positive:  In 2023, the per-person federal estate-tax exemption has grown to $12.92 million, which means that a married couple can pass a record of nearly $26 million to their family and other loved ones during life or after death without paying gift or estate tax. 

Now the bad news.  At the end of 2025, the laws governing federal transfer taxes change such that the amount can be given tax-free will be cut in half, to an estimated $7 million per individual ($14 million per couple), after inflation adjustments.

If the amount of wealth you want to give to your family exceeds the reduced federal exemption, then I encourage you to actively consider steps you can take before the law changes to reduce future transfer taxes.  Trusts that can be helpful in this regard include spousal trusts, qualified personal residence trusts, irrevocable life insurance trusts, grantor retained annuity trusts, family limited partnerships, and charitable trusts.

Whatever approach you decide is best for you and your family, the time to act is now.  Please give me a call if you would like my assistance getting the ball rolling.

That’s all for now.  Have a great weekend and invest wisely my friends.