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Estate Planning Taxes

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“Estate planning taxes” do not exist. There is no tax on the process of estate planning. However, if you neglect to set up an estate plan, it will cost you. If you don’t take action, your family will lose money in the form of probate, state estate taxes, and federal estate taxes. None of these is an “estate planning tax,” but they are all very real costs that you can and should avoid.

 

What documents do you need in place to avoid costing your family? You need a Will, a Trust, a Durable Power of Attorney and a Living Will. The will and trust work together in a good estate plan.

 

You may have heard that the “Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010″ will only tax estates with more than $5 million. You may figure that there is no way you will pay taxes. This may be true, however, this law expires in two years and the estate tax limits return to $1 million.

 

Plus there are other costs associated with dying that a good estate plan will help you avoid. That makes establishing a good estate plan essential.

 

Now is also a good time to review your estate planning documents, if you already have them in place, because the “Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010″ has changed estate planning.

 

Yes, it eliminated federal estate taxes for most families, but it contains certain provisions that will cause your trust to trigger a horrendous state estate tax. If you have a living trust, your living trust must now be revised in 17 states.

 

So, even though there aren’t any “estate planning taxes,” if you haven’t done any estate planning you need to do it now. If you don’t have an estate plan, taxes in the effected 17 states could cost even modest estates hundreds of thousands of dollars.

 

If you already have a plan in place, you still need to put some work into your estate planning and make sure everything is ok after the new laws.

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About the Author

Attorney Lee R. Phillips is a nationally recognized attorney who has helped thousands of audiences understand the latest asset protection, business structuring and tax planning techniques. He is a counselor to the United States Supreme Court and holds licenses in law, real estate and insurance. He has a BS in geology, MS in analytical chemistry, and JD in law. Shortly after starting his career as a patent attorney, he started a cancer research project as the national guinea pig, which included five months in isolation intensive care. Over 150 doctors participated directly in his treatment. He understands his audience, because he lost everything due to his illness. You will understand why asset protection became his passion. For thirty years his company, LegaLees Corporation, has specialized in solving asset protection and tax problems for high net worth individuals. Lee is a motivating, engaging, and dynamic speaker who has spoken to over a million people throughout the United States, Canada and the Pacific Rim helping them understand the law and how to use it to their benefit.

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