One of the things that you would do well to keep in mind when you are considering the subject of estate planning is the fact that things do not stand still. When you first arrange for a consultation with an estate planning attorney and walk out of the office with an estate plan in place you could get complacent, feeling as though you have satisfied this responsibility.
This is a mistake because that initial plan is going to have been devised based on your life as it stood on that day. Time marches on, and inevitably things change, both within your family and throughout the society as a whole and many of these changes have an effect on your estate plan.
With this in mind you would do well to recognize the fact that the estate tax parameters are scheduled to change in the beginning of 2013. Because of the passage of the piece of legislation that has come to be known as the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 the current maximum rate of the estate tax is 35% and the exclusion is $5 million. But this tax relief act is going to expire at the end of 2012. As the laws currently stand, the exclusion will go down to $1 million and the rate will rise to 55% at that time.
Legislative changes that would impact these parameters are certainly possible. But at the same time, right now there is a congressional committee in place that is devising a plan for reducing the federal debt by $1.5 trillion over the next decade. This is going to require spending cuts. Given this reality, pushing for further estate tax relief at a time when tough cuts are being made may be a difficult sell in some quarters.
It may be unrealistic to expect the typical layperson to stay on top of all of these intricacies. This is why it is a good idea to develop a relationship with an experienced estate planning attorney who will gain an understanding of your situation and let you know how to proceed in light of any changes that may take place.
- How Will You Age in Place and Be Able to Die at Home? - August 16, 2020
- Beneficiary Designations and Other Non-Probate Transfers - August 15, 2020
- Leaving Assets Can Be Tricky – Part 3 - August 13, 2020
