Why You Need It And Where To Find It - Estate Planning Tax Advice
Your estate consists of the assets that you will pass on to your beneficiaries when you pass away. Estate planning means deciding where your assets will go when you die. It takes time, thought, and the knowledgeable assistance of a qualified attorney. Even if you diligently plan your estate on your own, it is easy to make mistakes. Mistakes can result in portions of your estate being unnecessarily taxed and assets going to the wrong beneficiaries. We have compiled a list of some of the most common mistakes individuals make in estate planning. Please review the list, but also plan to meet with a qualified attorney to review your unique estate.
The Economic Growth and Tax Reconciliation Relief Act of 2001 (EGTRRA) threw many individuals for a loop when it came to estate plannings. Tax laws are never simple but EGTRRA added a level of confusion rarely seen in advanced planning. For instance, between now and 2011 the federal estate tax is scheduled to decrease, disappear and then spring back to life. According to a Wall Street Journal article dated May 11, 2005, the "...current estate tax law puts estate-tax planners in an impossible situation...". With such uncertainty, some potentially damaging estate planning myths have surfaced. These financial "urban legends" stand in the way of prudent estate planning. We will address some of the most prevalent and most common estate planning myths so we can be better informed. Myth. The Federal Estate Tax was repealed.
If you find that they are, it will be worth your while to discuss with an expert the estate planning tax strategies which will let you preserve as much of your assets as possible for your heirs. These strategies can include things placing your assets into a living so that you can control them during your lifetime, and prevent them from being included in your taxable estate when you die. Having a living trust will also benefit your heirs, because it will exempt you assets from being tied up in the expensive and lengthy probate process.
Central to estate planning is choosing people to make decisions for you both during incapacity and after your death. These people include trustees, guardians, agents, and beneficiaries. Make sure that you select an agent who knows you and your wishes well. He or she will speak for you when you cannot, so it is vitally important that he or she knows you well. Make sure you and the agent have a clear understanding of his or her role in your estate and that you have clearly communicated your desires.
If you do follow the advice of an estate planning tax professional, make sure that you keep copies of all the estate planning documents. They will be essential in case you have the bad luck to deal with an unqualified party, and your heirs need to prove a claim of negligence.
Instead of repeal, reform of the federal estate tax is a possibility. Several key lawmakers were up for re-election in 2008 and they would have liked to see the estate tax issue resolved prior to Election Day. Such did not happen. Almost everyone agrees that something needs to be done to make the federal estate tax more predictable and user friendly. It seems that the current political climate could be the right time for reform. One possible reform is to freeze the 2009 rates and exemption amounts for 2009 and beyond with an exemption amount of $3.5 million per estate and a top tax rate of 45%. Only time will tell what happens, but one thing is certain, doing nothing and waiting for Washington to fix things is probably not in your or your family's best interests.
The Economic Growth and Tax Reconciliation Relief Act of 2001 (EGTRRA) threw many individuals for a loop when it came to estate plannings. Tax laws are never simple but EGTRRA added a level of confusion rarely seen in advanced planning. For instance, between now and 2011 the federal estate tax is scheduled to decrease, disappear and then spring back to life. According to a Wall Street Journal article dated May 11, 2005, the "...current estate tax law puts estate-tax planners in an impossible situation...". With such uncertainty, some potentially damaging estate planning myths have surfaced. These financial "urban legends" stand in the way of prudent estate planning. We will address some of the most prevalent and most common estate planning myths so we can be better informed. Myth. The Federal Estate Tax was repealed.
If you find that they are, it will be worth your while to discuss with an expert the estate planning tax strategies which will let you preserve as much of your assets as possible for your heirs. These strategies can include things placing your assets into a living so that you can control them during your lifetime, and prevent them from being included in your taxable estate when you die. Having a living trust will also benefit your heirs, because it will exempt you assets from being tied up in the expensive and lengthy probate process.
Central to estate planning is choosing people to make decisions for you both during incapacity and after your death. These people include trustees, guardians, agents, and beneficiaries. Make sure that you select an agent who knows you and your wishes well. He or she will speak for you when you cannot, so it is vitally important that he or she knows you well. Make sure you and the agent have a clear understanding of his or her role in your estate and that you have clearly communicated your desires.
If you do follow the advice of an estate planning tax professional, make sure that you keep copies of all the estate planning documents. They will be essential in case you have the bad luck to deal with an unqualified party, and your heirs need to prove a claim of negligence.
Instead of repeal, reform of the federal estate tax is a possibility. Several key lawmakers were up for re-election in 2008 and they would have liked to see the estate tax issue resolved prior to Election Day. Such did not happen. Almost everyone agrees that something needs to be done to make the federal estate tax more predictable and user friendly. It seems that the current political climate could be the right time for reform. One possible reform is to freeze the 2009 rates and exemption amounts for 2009 and beyond with an exemption amount of $3.5 million per estate and a top tax rate of 45%. Only time will tell what happens, but one thing is certain, doing nothing and waiting for Washington to fix things is probably not in your or your family's best interests.
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Frank Miller has a Debt Consolidation Blog & Finance, these are some of the articles: Choosing An Asset Protection Planning Professional You have full permission to reprint this article provided this box is kept unchanged.
posted by Vittoria @ November 03, 2013
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