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High net worth individuals should be aware of potential estate tax exposure. The tax carries a 40 percent maximum rate that can consume a great deal of what you have been able to earn throughout your life. There is an unlimited marital deduction that allows you to leave unlimited assets to your spouse tax-free. Asset transfers to people other than your spouse are potentially subject to the estate tax. In 2014, the first $5.34 million that is passed along can be transferred free of the death … [Read more...] about What Is a Qualified Personal Residence Trust?

Taxation is something that you constantly face throughout your life, but it can also come into play after you pass away. Many people question the fairness of the estate tax, because it is imposed on assets that you have left after paying many taxes along the way, but it is a fact of life whether it is fair or not. Fortunately, most people don't have to pay the estate tax, because there is an estate tax exclusion. You can pass along a certain amount before the tax would kick in, and this … [Read more...] about 2015 Estate Tax Exclusion Adjustment Released By IRS

The fact that there are a lot of rather wordy terms used in the legal field is no secret, and this is where the term "legalese" comes from. Sometimes legal devices are reduced to acronyms so that they are easier to refer to, and this certainly enters the estate planning realm. With this in mind, we will look at the ILIT in this post. Estate Tax Efficiency In an estate planning context, the acronym ILIT stands for an irrevocable life insurance trust. This type of trust can be used to … [Read more...] about What Is an ILIT?

In this post we will look at the role of the living trust trustee and the qualities that you should look for when you are choosing a trustee. However, before we get into that subject, we should explain why you may want to consider the creation of a revocable living trust. Efficient Asset Transfers A revocable living trust would be used by someone who would otherwise be using a last will as a vehicle of asset transfer. Why would you want to use a living trust as an alternative? The answer is … [Read more...] about How Do I Choose a Living Trust Trustee?

When people start to get serious about estate planning, a lot of questions about taxation are naturally going to arise. There are innumerable taxes that come to mind, and one of them is the capital gains tax. If you are in possession of assets that have appreciated, the capital gains tax can be applicable if you realize a gain. You realize a gain if you sell the asset and take personal possession of the appreciation. At that point you are no longer allowing the market to dictate the value of … [Read more...] about What Is the Capital Gains Tax?