Did you know Congress has yet to extend the 2009 estate tax laws? It’s true. And while they can still extend the ’09 rules, if they don’t, the rules will be altered next year. Consider this: at the start of 2010, the Feds’ estate tax disappeared as a new capital gains tax on all inherited stocks, properties, businesses and collectibles, was, without warning, applied to thousands of estates.
Focusing on smart, headstrong estate planning can make certain one’s wishes are followed and assets are protected, with minimal tax impact. But time is of the essence, especially if one’s estate is nearly, or greater than, $1 million. Regardless of the estate’s overall value and size, at the end of the day, one should always document the values of all estate assets. This includes valuing stocks on the date the person dies as well as obtaining appraisals for assets (home), after the owner passes away.
Estate planning provisions should be added which focus on how cost-basis exemptions should be addressed in the event one dies and current capital gains rules are still utilized. Without such provisions, families often wind up in court as estates are divided amongst random heirs.
There are numerous ways one can better their estate planning. It’s important to meet with an estate planner or attorney well-versed in estate planning as they will prove instrumental in reviewing old formula clauses, found today, in most wills or living trusts. Most of these old formulas leave courts with the impression one is leaving an unlimited amount to another heir—instead of a spouse or kids.