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Non-Tech : Estate Planning -- Ignore unavailable to you. Want to Upgrade?

To: posthumousone who wrote (24)	4/2/1998 1:37:00 AM
From: Taxboy	Respond to of 36

If your taxable estate is less than $625,000 and you have not used any of your "Applicable Credit Amount" (the technical term for the exemption) by lifetime gifting, your estate will owe no taxes and no estate tax return will be filed. But alot of things that you might not consider assets are included in your estate. For instance, if you are the owner of a $500,000 term life insurance policy, that is part of your estate and with a little home equity and 401(k), you would owe estate tax unless you planned correctly. So the $625,000 can be a deceptive figure.

To: posthumousone who wrote (24)	4/2/1998 1:12:00 PM
From: voodooist	Read Replies (1) \| Respond to of 36

Even if no federal taxes are due, depending on your state you may owe state inheritance (death) taxes. Also, for planning purposes, above and beyond the $10,000 per year per person (unlimited people) that can be gifted, one can pay unlimited medical bills as well as even health insurance for a relative as long as the payments are made directly to the doctor, hospital, insurance company. Also, you can pay for educational tuition as long as it is at a full-time place of study and paid directly to the institution. This means that grandparents can give to their children and their spouses and their grandchildren ten thousand each and pay all medical costs and even university or private schools. For the rich this is a way to remove a lot of assets from their taxable estates. Also there's another method useful for parents called a qualified primary residence trust. You put the house into a irrevocable trust for a certain number of years and the value of the gift gets discounted based on the number of years specified for the trust and the current interest rate at the time it is done. I am not a lawyer or an accountant so of course you should all consult your tax lawyers about all of this.