And while income, capital gains, and estate taxes are key concerns, watch out for state taxes. New York State is considering a millionaire's tax—something tried in New Jersey with mixed results.
"People picked up and moved," Jack Meola, a tax attorney and partner at Amper Politziner & Mattia says of the New Jersey experience. "The rich are the most mobile people in the world. I have clients with no state domicile. They're doing business all over the world. They've put their homes in trusts, so they personally have no jurisdiction. One client lives on a boat. Most move to nontaxing jurisdictions, like Las Vegas and Florida."
These mobile individuals set up trusts so that when their businesses are sold, they don't feel a tax pinch.
For the state, the effort backfires, he notes. Diminishing populations of wealthy individuals result in a trickle-down effect that builds pressure on low-income people to carry the tax impact.