How to Avoid Estate Tax

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The terms estate taxes, death taxes and inheritance taxes are often used interchangeably. They are a tax imposed by the government, and generally speaking, they have nothing to do with probate. Smaller estates don't have to pay estate tax, so most families simply don't worry about them.Even larger estates usually don't have to pay estate taxes, because there are a number of legal tools that can help eliminate any estate taxes actually payable.Estate taxes are often called the voluntary tax, because if you plan for them you don't have to pay them. The rich don't lose all their money when a family member dies. Why should you lose a dime?
An estate tax is actually imposed on every dime of a dead person's estate.Even though a tax is imposed, most people don't actually pay any tax, because everybody is given a credit to offset a specific amount of the estate tax imposed. The exact amount of property an individual can pass without paying an estate tax changes quite frequently. The estate tax brackets and the rates within each estate tax bracket don't change. It is actually the credit amount that changes.
In the US, the estate tax is actually "unified" with the estate tax, and the credit is called the "unified credit." You will have to actually look up the unified credit amount each time you want to know what it is, because it changes often.The amount of property that generates an estate tax equivalent to the amount of unified credit available to offset the estate tax is called the "exemption equivalent." When people say that you can pass one million dollars without an estate tax they are really saying that the unified credit at that time is the amount of credit needed to offset the tax imposed on the first one million dollars in estate value.
Lots of people are surprised to learn they actually have a taxable estate, because the estate includes the assets like the retirement accounts, stocks, bonds, little business, life insurance face values, and of course, all of the real estate.Most people don't think the life insurance is included, but in most cases it is included in the estate tax calculations.With inflation ballooning estate values, many families are surprised to find out that there will actually be some estate tax paid when mom or dad die. The estate tax rate on the first dollar, where there is actually an estate tax payable, is close to 50%. So, an estate that is only a half a million dollars above the exemption equivalent can generate a payable estate tax of almost a quarter of a million dollars. So what if you pay the attorney his $10,000. If you can get an extra $250,000 to your family, it is money well spent.
Lee R. Phillips's FREE DVD, Using the Law to Make Money and Protect Your Assets, coupled with his new book, Guaranteed Millionaire, shows you how to remove life insurance from the estate tax problem. With the book and DVD, you will learn how a couple can use a trust to move twice as much property to their heirs with having any estate tax issues.If removing the life insurance from the estate tax exposure and being able to pass twice the exemption equivalent doesn't solve your estate tax problem, other options are available. Corporations, LLCs, Family Limited Partnerships, and other legal tools are detailed in the FREE DVD and book, so you can get the asset protection and estate tax relief you want.Act now and order Guaranteed Millionaire with the FREE DVD, so you can eliminate estate taxes and get great asset protection.

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