What is the Difference Between a Will and a Trust?
February 20, 2017I Don’t Know the Difference Between a Will and a Trust Learn the pros and cons of wills and trusts. A will is a document that tells the world where you want your assets to go when you die. It becomes effective only upon death. Unfortunately, your will controls only the property you own in… Read more »
What is the Generation Skipping Transfer Tax?
February 13, 2017What Is the Generation Skipping Transfer Tax (GSTT)? Estate planning can help you pass on assets to your heirs while potentially minimizing taxes. When gifting assets, it’s important to consider when and how the generation-skipping tax transfer (GSTT) may apply. Also called the generation-skipping tax, this federal tax can apply when a grandparent leaves assets… Read more »
Why is it Better to Pay Gift Taxes Rather Than Estate Taxes?
February 09, 2017You may hear an advisor refer to gift and estate taxes as being “tax exclusive” or “tax inclusive,” respectively. This terminology is sometimes confusing, and may be better understood by saying that a gift is tax exclusive, because the taxes due are not subtracted from the gifted amount going to the heirs, but are paid… Read more »
Reduce my Federal Estate Taxes to Zero?
February 07, 2017Yes, the estate tax is a voluntary tax! You can choose to pay it by not planning ahead, or you can reduce or even eliminate it with planning. The easiest and simplest way to eliminate the Federal estate taxes at death is to not allow your estate to be valued more than the Federal Estate… Read more »
What is the “Unlimited Marital Deduction?”
February 03, 2017Explain Unlimited Marital Deduction for Me The definition of unlimited marital deduction is a provision in the U.S. Federal Estate and Gift Tax Law that allows an individual to transfer an unrestricted amount of assets to their spouse at any time, including at the death of the transferor, free from tax. The unlimited marital deduction… Read more »
You Mean There are State Death Taxes Too?
February 01, 2017Are There State Death Taxes? That depends. Some states have a separate death tax and some do not. Historically, for those states that have a state death tax, the tax is either independent of the federal estate tax system or tied to the federal estate tax system. In those states that have an independent death… Read more »
What is the Federal Estate Tax?
January 30, 2017Learn the Facts: Federal Estate Tax At the end of 2010, Congress passed the ‘‘Tax Relief, Unemployment Insurance Preauthorization, and Job Creation Act of 2010.” Special provisions apply to those who died in 2010. In 2011 and 2012, there was an exemption amount from federal estate tax of $5 million and $5.12 million per person… Read more »
Avoid the Estate Tax and Gift Tax and Still Make Lifetime Gifts?
January 26, 2017Learn How To Avoid Estate and Gift taxes and Still Make Gifts During Your Lifetime? Gifts can be categorized as present interest or future interest gifts. A present interest gift means the person receiving it has immediate possession or enjoyment of the gift. A future interest gift is the opposite of a present interest gift,… Read more »
What is the Gift Tax and Why do We Have One?
January 24, 2017The Gift Tax – What it is and Why We Have One The gift tax is a tax the federal government imposes on an individual for gifts made during lifetime. The tax will apply to an outright gift or a gift to a trust. The reason we have such a tax is to prevent individuals… Read more »
Is it Wrong or Somehow Unpatriotic to Want to Reduce My Taxes?
January 20, 2017How Can I reduce My Taxes or is that Unpatriotic? Some believe it is illegal and possibly immoral to use estate planning strategies to reduce one’s taxes. I want to reduce my taxes. Judge Learned Hand stated more than a century ago that: “Anyone may arrange his affairs so that his taxes shall be as… Read more »