Some Observers Decry Estate Tax Rate
Where do you draw the line when it comes to a tax rate? This is an ongoing question that is always being debated among lawmakers. However, even the most zealous pro-tax advocates may have to concede that a tax that consumes the majority of the resources in question is a bit excessive. This will be the case with the federal estate tax in 2013, assuming the laws that are in place as of this writing remain in effect.
In 2012,we have a 35% maximum estate tax rate and this is certainly not a small pittance.But when the tax relief act that was signed into law in December of 2010 expires at the end of the year,the law mandates an increase in the top rate of the estate tax.In 2013 the rate will be 55%.
Clearly,a tax of this magnitude can have an enormous impact on future generations of your family because it would be imposed generation in and generation out.
The matter is not permanently closed however because many people feel that the rate is excessive.Others call for a repeal of the estate tax altogether,and there have actually been measures proposed by legislators that would repeal the estate tax.
Until and unless the estate tax is in fact abolished,action is required if your resources exceed the exclusion amount (which will be just $1 million in 2013).There are legal steps that can be taken to mitigate your estate tax exposure,and this is something you should discuss with your attorney sooner rather than later.
ABOUT THE AUTHOR: Roy Litherland
Experienced estate planning attorneys Campbell CA of the Law Office of Roy W. Litherland offers estate planning and business planning resources to residents of Campbell CA.
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.