Tax Planning

Under current federal law most Americans do not have a federal estate tax problem. Under the 2010 Tax Relief Act (formally abbreviated as TRUIRJCA 2010), every individual has a $5 million federal estate tax exemption. If you do not need that entire amount, the balance of your exemption is ‘portable’ to your surviving spouse when they later die. So for married couples, it’s fairly easy to shelter $10 million from federal estate taxation with little or no planning done in advance.


Many states, however, impose a separate estate tax that is often more widely applicable than the federal estate tax. Because the state and federal estate tax systems are often out of sync, it is important to coordinate your estate plan in a way that maximizes your estate tax planning opportunities to ensure that you pay as little in estate tax as possible.


Moreover, proper tax planning in the estate planning context must contemplate income tax planning opportunities ‘ for you and for your heirs ‘ as well as capital gains, generation skipping transfer, and other tax systems.