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    Joshua and Laura Meier Newport Beach Trust and Estate Planning Attorneys Focused on Helping Families with Young Kids
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    Oct 9 12

    Fiscal Cliff? Beware Of Estate Taxes!

    Newport Beach Law Firm

    Should the current estate tax law expire at
    year-end without Congressional action, nearly 15 million U.S. households will
    have a potential estate tax liability, according to new research.

    Will the Bush-era tax laws
    expire after December 31, 2012? To expire or not to expire, that is the
    question.

    When it comes to the “default”
    2013 estate tax, some 12.5% of U.S. households may come under the estate tax
    axe, according to new analysis by LIMRA. These numbers were picked up and
    reported by LifeHealthPRO and
    reported in its article titled, “LIMRA: More than 1 in 8 U.S. households may
    owe estate tax in 2013
    .

    This change in the estate tax
    exemption limit scoops up a huge new group of taxpayers in its dragnet who
    otherwise might not have been subject to the estate tax axe. In fact, many in
    this new group of estate tax taxpayers have not previously found themselves at
    the top of the wealth pyramid. So, how is this possible?

    If (or when) we fall off the
    fiscal cliff, the IRS will be forced to apply 12-year-old laws, and with them a
    12-year-old estate tax exemption and its estate tax rates. In other words, the
    estate tax exemption will revert to $1 million from the current $5.2 million,
    and a 55% maximum estate tax rate will replace the current 35% rate. Yes, that’s
    a quite a low blow.

    Remember, it’s not just your
    bank account that the IRS counts against your estate tax exemption, but all of
    your assets, to include your home and life insurance death benefits.

    Unfortunately, that’s just the
    tip of the tax iceberg. Not only is it absolutely vital to keep track of the
    law, but it is essential that you know the steps to take now to protect
    yourself and your loved ones in the event Congress and the White House fail to
    act.

    This is an excellent time to schedule
    a year-end review with your estate planning attorney, so you can ensure your
    estate plan will be able to survive a tumble off the tax cliff.

    Contact Meier Law Firm to discuss all of your Estate Planning needs. 

    Reference: LifeHealthPRO
    (September 27, 2012) “LIMRA: More than 1 in 8 U.S. households may
    owe estate tax in 2013




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