During this crazy 2020 tax year, in addition to being faced with all the issues surrounding Covid-19, as well as the roller coaster ride of the stock market, we are also currently in an environment where the interest rates are as low as they ever have been.
Federal estate, gift and GST tax exemptions are currently at historic highs ($11.58 million per individual in 2020). These higher exemptions are scheduled to return to $5 million, adjusted for inflation, after December 31, 2025, but they could be reduced before then, as a result of political or policy changes.
Despite many attempts at repeal over the years, the modern U.S. Estate Tax has been in place since September 8, 1916. Each U.S. citizen and resident alien is entitled to a lifetime exemption from the federal Gift/Estate Tax called the Applicable Exclusion Amount.
If you have updated your estate plan during the Covid crisis and even found a way to sign your documents while maintaining social distance, do not overlook the last step of trust funding.
If you like the way the laws are today, you need to take advantage of them now, before they are changed tomorrow. In other words, use it or lose it.
Life insurance may play a vital role in an estate plan, because insurance proceeds can be counted on to provide liquidity when it’s needed.
Somewhere between a corporation and a partnership lies the limited liability company (LLC). This hybrid legal entity is beneficial not just for small-business owners but is also a powerful tool for estate planning.
The most well-known ‘death’ tax is the Federal Estate and Gift Tax. However, the reality is that few people really have to worry about the cost of federal estate taxes.
There have been several law changes that affect IRAs passed since December 2019.
When a loved one dies, any leftover IRA funds they had, goes to whomever they labeled as beneficiaries. If you’re a beneficiary, you have to decide how you’re going to use it—a decision that’s a little more complicated this year than it normally is.
