Monday, January 09, 2017

estate tax


  • if u are married, assets left to a surviving spouse are exempt from the federal estate tax
  • if ur estate passe on to someone other than a spouse, ur heirs may owe federal estate
  • in 2007, this is levied on estates valued at more than 2 million, including the value of investments, ur home, the death benefit on ur life insurance policy --- add them all up, if they exceed 2 million, ur heirs may be stuck paying a tax on part of their inheitance
  • if ur estate will be above the estate-tax threshold, u need to working with an estate attorney to set up what is known as "irrevocable life insurance trust"
  • irrevocable life insurance trust
  1. the trust will be the "owner" of the life insurance policy
  2. ur beneficiaries will still receive every penny of the death benefit, but the value of the policy is exempt from the estate tax
  3. this kind of trust is very different from a revocable living trust

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