Benefits of the Cost Basis Step Up
Clients planning to make gifts to family members or others often ask us whether it would be better to gift cash or investible assets. While the answer depends on the client’s specific situation, the ability to step up the cost basis of appreciated assets at death is an important consideration.
As confidence in an (eventual) economic recovery continues to spread through financial markets, several of the biggest beneficiaries have been some emerging market currencies. Among those that have spurted higher lately include Brazil and Mexico, although still far down year to date. And important to note that although financial conditions have strengthened for Latin America, the economic conditions on the ground have yet to show any improvement and remain dismal.
New reports from the IMF makes for grim reading.
The global economy is expected to contract by 3% in 2020.
Perhaps even scarier is the accumulation of unprecedented debts. The world's fiscal debt level will climb from 83% of GDP to 96%. The situation is even worse for developed countries as governmental debt will reach 122% of GDP.
Year in Review – Twelve Months ended March 31st, 2020
Given the monumental impact of the coronavirus disease (COVID-19), it is virtually impossible to discuss the twelve-month period as a continuous period. It’s more sensible to think about the world before COVID-19 (to be referred herein as BCV) and after (ACV). For our purposes here, we will define that demarcation point as the middle of February, when investors woke up to the cataclysmic impact the disease would have on the economy. There is little one could say about BCV that would be applicable to ACV.
