Healthcare Provider Update: Healthcare Provider for Thermo Fisher Scientific Thermo Fisher Scientific does not operate as a healthcare provider in the traditional sense; rather, it is a leading global provider of laboratory equipment and healthcare solutions, primarily serving pharmaceutical companies, hospitals, and research institutions. The company's services range from the manufacture of laboratory supplies to offering analytical instruments and diagnostic reagents, thereby supporting healthcare providers in their missions. Potential Healthcare Cost Increases in 2026 As healthcare costs continue to climb, 2026 is anticipated to see significant premium increases for consumers, particularly within the Affordable Care Act (ACA) marketplace. With some states projecting hikes exceeding 60%, factors like the expiration of enhanced federal subsidies and escalating medical costs converge to challenge affordability. Reports indicate that without congressional intervention, approximately 92% of ACA policyholders may face a staggering rise of over 75% in out-of-pocket premiums. This financial strain underscores the urgent need for individuals to proactively navigate their healthcare options. Click here to learn more
New changes in federal gift and GST tax exemptions provide a unique opportunity for proactive estate planning, especially for Thermo Fisher Scientific employees who want to transfer wealth without incurring significant taxes,' says Kevin Landis, a representative of The Retirement Group, an affiliate of Wealth Enhancement Group.
Brent Wolf from The Retirement Group, a division of Wealth Enhancement Group, encourages Thermo Fisher Scientific employees to take advantage of the temporary increase in gift and GST tax exemptions as a means of effective estate planning.
In this article, we will discuss:
1. The role of Inflation Adjustments: How the 2024 inflation adjustments to federal gift and GST tax exemptions create new opportunities for tax efficient wealth transfer.
2. Strategies for Estate Planning: An overview of various estate planning strategies including SLATs, GRATs, and Dynasty Trusts that can be useful for Thermo Fisher Scientific employees.
3. State Tax Consequences: How state taxes affect estate planning and what this means for residents of New York, New Jersey, and Connecticut.
The federal gift and generation-skipping transfer (GST) tax exemption amounts have been raised due to the latest inflation adjustments from January 1, 2024. This adjustment presents new possibilities for sophisticated estate planning especially for the benefit of Thermo Fisher Scientific employees. It is now possible to exclude $13,610,000 for an individual and $27,220,000 for a married couple from federal gift and GST taxes. In the present economic environment of low asset values these changes present a good opportunity to move wealth across the generations.
The federal estate and gift tax exclusion, as well as the GST tax exemption, were initially heightened by the Tax Cuts and Jobs Act of 2017 and then heightened again by the 2024 inflation adjustments. This enables many assets to be transferred without tax consequences during the owner’s lifetime or at their death. However, these higher exemption levels are only temporary and will return to their pre-2018 levels (adjusted for inflation) beginning January 1, 2026.
The new regulations increase the amount that can be gifted in 2024 by an extra $690,000 for individuals and $1,380,000 for married couples if other exemption thresholds have been used. This update is important as it provides opportunities for taking full advantage of tax-deferred wealth transfers while the tax laws permit it. The American Taxpayer Relief Act of 2012 also allowed the surviving spouse to use the deceased spouse’s unused federal estate tax exclusion in paying for the deceased’s lifetime gifts or estate planning.
The annual federal gift tax exemption has also been increased to $18,000 per recipient, or $36,000 for married couples who choose to gift together. This increase expands the opportunities for tax planning to gift and still leave some exemption available to pay for tuition or medical expenses — important for Thermo Fisher Scientific employees who are helping to pay for their families’ education or health care. It also helps with the possibility of gradual giving.
State Specific Factors to Consider:
This is especially important for residents of New York, New Jersey, and Connecticut because of state tax consequences. For instance, New York does not have a gift tax but has many opportunities to take advantage of large federal exemptions in order to avoid state estate taxes, especially in light of recent market conditions. New Jersey has no gift or estate taxes, but does have an inheritance tax on transfers to non-lineal descendants at rates up to 16%. Connecticut is the only state with a gift tax, but because of the synchronization of federal and state exemptions, the burden is reduced.
Estate Planning Techniques:
In the present tax regime, the following strategies should be considered for Thermo Fisher Scientific employees:
1. Spousal Lifetime Access Trusts (SLATs): These enable the client to invest and grow assets outside the taxable estate while ensuring that the spouse is well provided for through the use of exemption amounts.
2. Grantor Retained Annuity Trusts (GRATs): These provide for the transfer of any appreciation in the assets to beneficiaries without incurring tax on the amount retained in the annuity, which is particularly advantageous in a volatile market.
3. Dynasty Trusts: These trust arrangements are created to take full advantage of the GST tax exemptions and hold assets beyond estate, gift, and GST taxes for multiple generations, providing a long-standing protection against creditors’ claims.
4. Intrafamily Loans and Sales to Grantor Trusts: These methods use valuation approaches and low-interest rates to move the wealth and at the same time reduce the value of the estate that will be taxed, while the assets grow.
Income Tax Considerations:
Grantor trusts are quite efficient from the perspective of income taxes as the trust’s income is reported on the grantor’s return, allowing the assets to grow without being taxed. This structure can be very useful for asset swaps that may reset the basis for capital gains after the grantor has died. In conclusion, the temporary increase in federal tax exemptions presents an important opportunity for Thermo Fisher Scientific employees to plan their estates. Using these exemptions together with sophisticated gifting and trust arrangements can lead to substantial tax savings and wealth protection.
It is, therefore, important to have a clear understanding of both state and federal tax laws and to have an appropriately tailored estate plan to meet personal and family objectives. The state estate taxes can significantly influence estate planning and therefore cannot be ignored, particularly for people nearing retirement or who are already retired. This is especially important in states such as Massachusetts and Oregon where the estate tax starts at $1 million in value and it is imperative to use federal exclusions to avoid state tax consequences while maximizing on federal tax benefits.
Featured Video
Articles you may find interesting:
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
These adjustments to the GST and federal gift tax exemptions are like steering a ship through a rapidly changing sea. Like a good captain, Thermo Fisher Scientific employees can take advantage of these temporarily higher exemptions, now at their highest ever, to steer their retirement.
Disclosure: Not tax advice. Please consult with a qualified tax professional regarding your unique situation.
Sources:
1. 'IRS Provides Tax Inflation Adjustments for Tax Year 2024.' Internal Revenue Service, 9 Nov. 2023, www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2024 .
2. 'How Do the Estate, Gift, and Generation-Skipping Transfer Taxes Work?' Tax Policy Center, Jan. 2024, www.taxpolicycenter.org/briefing-book/how-do-estate-gift-and-generation-skipping-transfer-taxes-work .
3. 'Estate, Gift, and GST Taxes.' American Bar Association, 2024, www.americanbar.org/groups/real_property_trust_estate/resources/estate_gift_and_gst_taxes .
4. Driessen, Grant A., and Jane G. Gravelle. 'Overview of the Federal Tax System as in Effect for 2024.' Congressional Research Service, 2024, crsreports.congress.gov/product/pdf/R/R45145.
5. 'What's New — Estate and Gift Tax.' Internal Revenue Service, 2024, www.irs.gov/businesses/small-businesses-self-employed/whats-new-estate-and-gift-tax .
What is the 401(k) plan offered by Thermo Fisher Scientific?
The 401(k) plan at Thermo Fisher Scientific is a retirement savings plan that allows employees to save a portion of their salary on a pre-tax or after-tax basis.
How does Thermo Fisher Scientific match employee contributions to the 401(k) plan?
Thermo Fisher Scientific offers a company match on employee contributions, which helps to enhance the overall retirement savings of employees.
What is the eligibility requirement to participate in Thermo Fisher Scientific's 401(k) plan?
Employees of Thermo Fisher Scientific are typically eligible to participate in the 401(k) plan after completing a certain period of service, usually within the first year of employment.
Can employees at Thermo Fisher Scientific contribute to their 401(k) plan through payroll deductions?
Yes, employees at Thermo Fisher Scientific can contribute to their 401(k) plan through convenient payroll deductions, making it easy to save for retirement.
What investment options are available in Thermo Fisher Scientific's 401(k) plan?
Thermo Fisher Scientific's 401(k) plan offers a variety of investment options, including mutual funds, stocks, and bonds, allowing employees to choose based on their risk tolerance and retirement goals.
Is there a vesting schedule for the company match in Thermo Fisher Scientific's 401(k) plan?
Yes, Thermo Fisher Scientific has a vesting schedule for the company match, meaning employees must work for a certain number of years before they fully own the matching contributions.
How can employees at Thermo Fisher Scientific access their 401(k) account information?
Employees can access their 401(k) account information through the online portal provided by Thermo Fisher Scientific's plan administrator.
What is the maximum contribution limit for the 401(k) plan at Thermo Fisher Scientific?
The maximum contribution limit for Thermo Fisher Scientific's 401(k) plan is subject to IRS guidelines, which can change annually.
Does Thermo Fisher Scientific offer a Roth 401(k) option?
Yes, Thermo Fisher Scientific offers a Roth 401(k) option, allowing employees to make after-tax contributions that can grow tax-free.
How often can employees at Thermo Fisher Scientific change their 401(k) contribution amounts?
Employees at Thermo Fisher Scientific can change their 401(k) contribution amounts at designated times throughout the year, typically during open enrollment or through specific plan provisions.