Does the New Estate Tax Law Affect Your Legacy?
In one word: YES.
Thanks to the new law, fewer families will pay estate taxes — but making your wishes become reality still takes careful planning.
The new changes recently signed into law made some big changes to the federal estate tax, which is applied to the value of what you leave behind at death. In addition to extending the Bush-era income tax cuts for two years, the law temporarily prevented estate taxes from imposing higher rates on American families. The new law provides for a $5,000,000 death exemption. The new law provides welcome relief, but it’s important to realize that it will expire at the end of 2012. Without an extension, estates over $1 ,000,000 will be exposed to tax rates as high as 55%. A million dollars may sound like a large sum, but not when you consider the 3 largest assets in most families estates; life insurance, retirement plans and your home equity.
Review Every Estate Plan
Reviewing wills and trust documents should be on everyone’s to-do list. We live in a world of constant change. Changes in your family, changes in the rules. The economic crisis has prompted many people to stick their head in the sand and do nothing to reevaluate their financial and estate plans.
Planning Your Legacy: Not Just for the Rich and Famous
Why Plan your estate? Life is full of choices. Where to live? What career to follow? Whether to purchase a home? Frequently, our lives are governed by the choices that we fail to make; the non-decisions that come from procrastination, ignorance or apathy. People can choose to plan their estates or they can do nothing. Whether your net worth is $5,000 or $5 million, everyone should have an estate plan.Estate planning is appropriate at any stage of life — if you don’t prepare for the inevitable, you may create needless heartache and loss for those left behind. Estate Planning is not just about documents. Good Estate Planning is a process that lets you keep control of your wealth while you are here; protect yourself and family; distribute your property to the people and causes that you choose, and all at the lowest overall cost.. Use good estate planners to ensure things work the way you want.