Familiarize Yourself with 2011 Estate Tax Laws.
The New Year is well underway, and we’re two months into a new estate tax law as well. Now is a good time to review your estate plan, and Forbes.com provides some “motivation” for proper legal planning by recounting tips we could all learn from last year’s highly-publicized celebrity estates.
Familiarize Yourself with 2011 Estate Tax Laws. George Steinbrenner, as you may recall, timed his death well by passing away in 2010 when there was no estate tax. Of course, while his estate was highly publicized, other wealthy people died last year, too – and now their heirs can elect whether to use the 2010 or the 2011 laws, picking whichever regime is most advantageous.
What are the 2011 estate tax laws? In a nutshell, the federal estate tax is back, at a maximum rate of 35 percent, with a $5 million exemption for individuals and a $10 million exemption for married couples. The gift tax and generation skipping tax are both set at the same $5 million level. Additionally, the annual gift exclusion remains $13,000 per individual per year.
The catch? These new laws are just temporary, in effect only through 2012. So don’t become complacent. You’ll want to stay tuned to see what develops, and what happens next. Sort of like a daytime drama, eh?
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