Financial service professionals providing trust and estate planning are bracing for changes in federal laws that could significantly affect the retirement plans they provide clients.

Roy Adams

“What happens in the next few months could cause some of the biggest changes we’ve seen in the trusts and estates field,” said Roy Adams, professor emeritus of estate planning and taxation at Northwestern University School of Law, where he taught both subjects for 25 years.

The biggest change will be to the estate tax, which will be repealed in 2010.

The next year it will revert to its 2000 version, which is less advantageous to those attempting to preserve wealth.

Additional changes could occur to estate and gift tax rules, and their effects could be greatest on family-owned businesses and heirs, as well as those making charitable contributions, according to Adams.

Income limitation on converting regular IRAs, 401(k) accounts and 403(b) accounts to Roth IRAs will be removed in 2010, giving the wealthiest Americans new access to these financial instruments.