There are two things about your death that you cannot know ahead of time: when it will happen and what the estate tax will be at the time. People often make the mistake of planning their estate around the current estate tax. If you pay attention to what happens in Washington, then you should know that this is a bad idea. Politician’s always tinker with tax rates. Instead, your estate plan should be built on a solid foundation no matter what the estate tax rate happens to be when your time comes.
It is understandable that people with large estates would prefer that their assets go to their heirs rather than the government by way of the estate tax. All estate taxes, however, are not avoidable. You might be able to find a way to minimize them with the help of an estate planning attorney. If you leave the division of your large estate up to the provisions in a Will, your estate will be subject to the highest estate tax rates. An estate planning attorney can help you set up a Trust in a way that minimizes the tax. One way, is to make a trust for each of your children that gives them an income during their lifetimes and then goes to their heirs. This is known as a generational skipping Trust.
An estate planning attorney might have even better ways to help you minimize the tax on your estate. Speak to one today about how to make a good estate plan regardless of the estate tax rate.
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