Estate and Gift Planning

A little planning can save thousands of dollars!

You can't take it with you, but failing to plan for your estate can mean that the government, rather than your heirs, may get the major portion of your hard-earned money. Why? Because the top estate tax rate is a whopping 55%!

You may be aware that a certain amount of your estate will be excluded from taxation. If your estate exceeds the excludable amount, it will be taxed at rates starting at 37% and going as high as 55%.

Over the next eight years, the Tax Relief Act of 2001 gradually reduces estate and gift tax rates, and the exemption amount will be increased. The estate tax will be repealed in 2010, but the gift tax will be retained. Ironically, the estate tax will be reinstated in 2011 to pre-2001 Act rules unless Congress acts to extend the new law. In the midst of these phase-in and phase-out provisions, a little planning can save thousands of dollars.

You may be surprised what your estate is worth. Add up the value of all your assets. Don't forget life insurance which may fall into your estate. If your total value exceeds the exclusion, you should investigate a few simple planning techniques that can cut estate taxes significantly.

In addition, there are some very effective estate planning ideas that can also cut your current income tax bill.

Some planning possibilities: