Estate Tax Planning

The media tends to place a great deal of focus on federal income tax, but despite that, the number of estates that actually pay this federal tax are proportionately small. Less than 12,000 estate tax returns were filed with the IRS in 2014, and of those, most of the estates did not even have to pay any federal estate taxes.

Thus, the estates that do pay the tax are those of the wealthiest of the wealthy in the country. By looking at the data on the returns where an estate tax was due it is possible to get an idea of what kind of assets wealthy people have.

As reported by the Wall Street Journal, in "When the Superrich Die, Here's What's in Their Wallets," the IRS has recently released that information for estate tax returns filed in 2014.

In many cases, knowledge is power. But in estate planning, knowledge by itself can be a dangerous thing. You need to pair knowledge of the most common estate planning mistakes with another kind of knowledge: what to DO about those mistakes. And we would even add a third thing: knowing WHO to ask for help!

For example, you might know that it is desirable to avoid probate, but that is of little use unless you also know how to create an estate plan that will keep an estate out of probate. For the same reason it is important to not only know what common estate planning mistakes are but also to know how to avoid them.

A recent article by The Street entitled "How to Avoid the Most Common Estate Planning Mistake" discusses the most common mistakes and how to avoid them. Tips from the article include:

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