They say that everything is relative and when you look at the recent changes to the estate tax it is a good idea to keep this truism in mind. The estate tax was repealed for 2010 but the last time it was in effect in 2009 the exclusion amount was $3.5 million and the rate of tax was 45%. This would represent a meaningful point of relativity when you consider the fact that the new "tax relief" bill that was passed and signed into law in the middle of December allows for a 35% maximum rate of … [Read more...] about Estate Tax Repeal Sentiment Builds In House
Keeping Estate Tax Changes In Perspective
There is a difference between less of a bad thing and a good thing, and this is something to keep in mind going forward when you consider the impact of the changes that have been made to the estate tax parameters. As has been widely reported, the estate tax exclusion amount was raised from the $1 million that had been anticipated up to $5 million, and the rate of the tax was reduced from the 55% that had been scheduled for 2011 down to 35%. If you are not in favor of the estate tax, this was … [Read more...] about Keeping Estate Tax Changes In Perspective
GST & Gift Tax Exemptions Raised Under New Tax Law
The new tax measure that made its way through Congress at the end of the year is being termed the "Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010." It is interesting to consider this juxtaposed alongside the act that was passed in the beginning of the last decade that was deemed the "Economic Growth and Tax Relief Reconciliation Act of 2001." The latter legislative action has since come to be known as the "Bush tax cuts." So when the matter of possible tax … [Read more...] about GST & Gift Tax Exemptions Raised Under New Tax Law
Bill Includes Changes In Estate Tax
The estate tax was repealed for 2010, but it was set to return in 2011 with a top rate of 55% and an exclusion of just $1 million. We say "just" a million because during 2009, the last year that the tax was in effect, the exclusion was $3.5 million. Clearly a lot of people were concerned because estates that were valued between $1 million and $3.5 million were going to be exposed to the tax in 2011 when they were exempt in 2009 and 2010. To make matters more difficult there had been talk … [Read more...] about Bill Includes Changes In Estate Tax
Estate Planning & Medical Gifts
Once you recognize the fact that the value of your estate is going to exceed the estate tax exclusion amount one of your primary goals is going to be to gain tax efficiency. This can be done by situating your assets in an intelligent manner and by transferring assets while you are still alive without incurring any tax liability. As we have previously covered in this space tax-free gift giving is a way to pass assets to your heirs in a tax-free manner while reducing the taxable value of your … [Read more...] about Estate Planning & Medical Gifts
Make Estate Planning Enjoyable
Unless we see some new legislation passed in Congress the estate tax exclusion in 2011 is just $1 million, and this is profound in light of the fact that it was $3.5 million in 2009 before the repeal that was in effect in 2010. So this is leaving a lot more estates vulnerable to the tax, and the top rate is 55% so this federal levy is certainly something to be avoided. One way to reduce the value of your estate in an effort to avoid estate tax exposure is through the giving of tax-free gifts. … [Read more...] about Make Estate Planning Enjoyable
Five Wishes Provide A Framework
Modern estate planning involves more than just the financial realities that go along with aging, and more and more people are coming to realize this. Living wills and durable powers of attorney for health care are now typically included in estate plans, and this is a very positive step. In our culture we tend to shy away from discussions surrounding death, but it is important to let your family know your thoughts concerning the way that you would like to be treated at the end of your … [Read more...] about Five Wishes Provide A Framework
Three Simple But Effective Inheritance Planning Vehicles
You see so many terms and acronyms tossed around when you are doing your inheritance planning research that it can all seem kind of complicated if not completely confusing. There are indeed some rather complex vehicles and combined strategies that are appropriate for some estates depending on the specific dynamics of a particular case. However, some of the strategies that are routinely utilized when planning estates both large and small are very simple to understand but highly effective all the … [Read more...] about Three Simple But Effective Inheritance Planning Vehicles
Estate Tax Looms In 2011
The estate tax was repealed for the 2010 calendar year, and any form of tax relief is more than welcome for most Americans. However, in 2011 the estate tax will be back in effect, and it is carrying a very significant bite upon its return. Unless congress acts to change the existing parameters, the maximum rate will revert back to the level that it was at in 2001, which is a whopping 55%. The exclusion will return to the 2002 level of $1 million. To give you an idea of how this stacks up against … [Read more...] about Estate Tax Looms In 2011
Planning for Estate Taxes
Estate taxes are federal taxes imposed upon the estates of decedent’s whose worth exceeds a certain amount. Are you worried that your estate will owe taxes after your death? The best way to avoid or lower the cost of estate taxes is by reviewing your estate regularly. Determine Your Net Worth Calculating your net worth each year is a good idea to help determine how well your assets are doing from one year to the next. Your net worth, the sum of all of your assets minus any debts that you owe, … [Read more...] about Planning for Estate Taxes
