Three Basic Ways to Reduce or Eliminate Estate Tax

Attorneys Cecil Smith and Carol Gonnella have published a summary of the current estate laws and then lay out three hypothetical examples to demonstrate the impact that these laws can have on financial situations and how things could change once they expire.

The article refers to the three basic ways to reduce or eliminate federal estate taxes. First, there is use of the unlimited marital deduction, which allows a spouse to give assets to his/her spouse free of estate tax and then defer those taxes until the surviving spouse dies. Second, the basic exclusion amount refers to the amount that a spouse can pass to an individual other than his/her spouse free of estate tax. Third, there is portability, which is where a spouse can allow a surviving spouse to use the deceased spouse’s remaining basic exclusion amount in certain situations.

To see the three hypothetical examples, please visit this link:

http://estateplanning.wealthcounsel.com/bid/79088/Understanding-the-Impact-in-2012-2013-of-Federal-Estate-Tax-Laws

See Cecil Smith & Carol Gonnella, Understanding the Impact in 2012 & 2013 of Federal Estate Tax Laws, WealthCounsel, Nov. 21, 2011.

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this article to my attention.