These days, most people are aware that there is a lot of confusion surrounding the estate tax. As an estate planning attorney / tax attorney, I have the pleasure of planning for a lot of unknowns and confusion regarding my clients' affairs. That is my job. Look at the unkowns and confusion and plan for it and straighten it out...Thus, the current situation regarding the estate tax is intriguing for me...but is not new to me (or more estate planning and tax attorneys).
With congress now in post-election turmoil and heavy ideological differences at stake, there are many things that we simply can’t yet know and this makes planning both essential and baffling for clients. Amongst the greater issues coming to the forefront is the looming return of the estate tax. The estate tax – also known as the “death tax,” “inheritance tax,” or "wealth redistribution tax" depending on one’s persuasion – has been suspended entirely for 2010. The suspension was the result of the inability of a divided congress to come to a decision, and so too, now we must wait on a divided congress to come to a decision on what is to happen next. Without Congressional action, the hiatus on the estate tax will dissolve on schedule and thereby return to the last status of the tax, as it was in 2001, with an exemption of $1 million and a top rate of 55%. Yes...this is the "worst" situation that most estate planning attorneys are planning for.
Morningstar Advisors throws a spotlight on the problem from all angles in their October/November issue. If you have much to lose because of the return of the estate tax, they advise that you prepare for the worst. It’s also wise to look at how the estate tax may play out in various circumstances – such as for “ordinary” middle class couples, blended families, same-sex couples, families with special needs children, and family businesses. Be sure to check out their tips for common family situations.
Whatever your situation is, it’s important to know what’s going on and how it affects you, but it is most important to have a plan with a competent advisor to help you and your family pass safely through this shifting terrain. I encourage everyone to become as educated as they want, but to also remember that estate tax planning is complex, so you need quality advisors.
Learn more about the federal estate tax on our website, including our handy estate tax calculator. Also, be sure to sign up for our free monthly e-newsletter, and follow this blog for updates. And if you are into it, follow our estate planning news on Twitter and Facebook, or follow our general law firm news on Twitter and Facebook.
It is very big problem for many pepole to pay tax properly.
Luckily you made great post! Thanks!
Posted by: cause and effect essay | 05/26/2011 at 03:16 AM