Author: Matt Brown Created: 5/11/2010 1:01 PM
Matt Brown, Partner at Brown & Streza LLP
By Matt Brown on 2/25/2011 9:21 AM

The gap between the richest and poorest Americans is at historic highs, with estimates suggesting that the top 1 percent of Americans hold nearly 50 percent of the wealth, topping even the distance before the Great Depression in the 1920s. A recent survey concluded that Americans desire a more equal distribution of wealth, and dramatically underestimate the current gap. Perhaps surprisingly, this was true for Americans at all wealth levels and among those who voted for George W. Bush over John Kerry. More

By Matt Brown on 2/22/2011 11:51 AM


By Matt Brown on 2/18/2011 8:34 AM

The Sum of its Parts: Reforming Charitable Donations of Partial Interests

Sarah B. Lawsky (UC-Irvine)


This essay analyzes the tax rule that permits a deduction for donating property to a charity, but denies a deduction for donating a partial interest in that same property. For example, someone who donates a building to a charity may be permitted to take a deduction for the fair market value of the building. But if instead of donating the entire building, that person permits the charity to use the building rent-free for a year, he cannot take any deduction at all. Drawing on insights from modern finance, the essay shows that the only reason Congress gave for enacting the partial interest provision does not actually provide a way to distinguish between partial interests and whole interests, and that other possible justifications for the provision are also unconvincing. The partial interest ban is at best unnecessary and at worst inconsistent with other areas of tax law, and it should therefore be repealed.

By Matt Brown on 2/18/2011 8:15 AM

From the NYU Colloquium on Tax Policy and Public Finance

Link to Materials: Envy and Altruism in Hard Times

Kenneth Scheve (Yale University, Department of Political Science)


The politics of economic crises bring distributive economic conflict to the fore of national political debates. How economic activity is to be regulated and how policy should be used to transfer resources between citizens become central political questions and the answers chosen often influence the trajectory of policy for a generation or at least until the next crisis. This paper investigates how social preferences, specifically envy and altruism, influence individual policy opinions in these debates. I argue that social preferences have a powerful influence on support for policy alternatives which in turn shape the incentives faced by politicians in setting policy. I conduct original survey experiments in France and the United States and provide strong evidence that individuals care both about how economic policy alternatives affect their own interests and how they influence the welfare of others. Their concern about the welfare of others is consistent with inequality aversion -- both envy and altruism. The analysis focuses on key policy areas in the response to the current international economic crisis: trade policy, financial sector regulation, and tax policy. This preliminary draft presents the results from the United States only as the French survey is in the field.

By Matt Brown on 1/27/2011 1:27 PM
Estate planning just got a lot more powerful. We all remember the Congressional fight over tax legislation last year. Democrats wanted unemployment benefits extended, and Republicans wanted massive tax cuts. President Obama’s compromise included a provision nobody anticipated – a $5 Million gift tax exemption. It is precisely the no-fiscal-analysis-whatsoever, horse-trading approach to these negotiations that suggests that this is a short-term deal that will not outlast the next two years.

This is extraordinary because the gift tax exemption has never been higher than $1 Million. The power of gifting early, before assets have a chance to appreciate, is a favorite tool of estate planning attorneys. Congress has indeed opened the estate planning floodgates.

There is a catch. This opportunity will only last for two years.

Everyone should be updating their estate plans to deal with some very serious issues created by this new law. Blended families may inadvertently give more or less than...
By Matt Brown on 12/15/2010 4:54 PM

The estate tax is viewed negatively by a wide swath of modern America - a society in which substantial weatlh accumulation is more common than ever and still more possible than ever.  Very interesting to look back upon history to see the broad popularity of the estate tax 100 years ago.  Despite all of the challenges we face, public policy discourses today versus 100 years ago demonstrate significantly more optimism and confidence in the availability of opportunities.  A tax that only affects 2% of the population is widely hated because of this widespread optimism.

By Matt Brown on 12/15/2010 11:47 AM
Title III of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 is titled as follows:


That’s right. It’s temporary. Meaning more uncertainty. Great. Is estate and gift tax planning dead? To the contrary! The next two years will provide an enormous planning opportunity if the bill is passed.

The bill amazingly provides for a $5 Million gift tax exemption. No, that is not a typo. In the past, clients had to go to extreme measures to take advantage of the exemption amount as it increased above $1 Million: they had to die. Not surprisingly, no client has yet found that a viable planning technique.

As you probably know by now, House Democrats voted yesterday not to allow the bill to reach a floor vote, mostly based on the perceived give-away to the rich of the estate and gift tax relief provisions. It may be that, to satisfy House Democrats, the bill is amended to temporarily go back to a $3.5 Million exemption amount with a 45% rate of 2009.

By Matt Brown on 11/11/2010 6:03 PM

The estate tax, as burdensome as it could be on some family businesses, is rarely the culprit in family business failures.  The culprit is more often the family's failure to adequately plan and to address business succession issues clearly.

By Matt Brown on 11/9/2010 5:06 PM

Good overview article on basic estate planning (although the advice on TOD accounts is generally a bad idea).