Turns out that 2010 is the year to die if you are a billionaire who wants to avoid federal estate taxes. Lets take a closer look at “what a difference a year makes”:
Those that died in 2009 paid a 45% tax for every dollar over $3.5 million (7 million for married couples who did the proper estate tax planning).
Those that die in 2010 pay no federal estate tax. The Yankees boss George Steinbrenner died this year and his family saved approximately 500 million in estate taxes. Compare this result to that of Bill Davidson, the owner of the Detroit Pistons who died in 2009. His family is selling the team in order to raise the money to pay the estate taxes.
Those that will die in 2011 will pay a 55% tax for every dollar over $1 million (2 million for married couples who did the proper estate planning).
As you can see from the above, not only will many more people be exposed to paying more in taxes in 2011 due to the lowering of the exemption from 3.5 million to 1 million, but the rate of tax has increased from 45% to 55%.
If you have an estate that may be worth more than 1 million, including life insurance, you should meet with an estate planning attorney to minimize the amount of estate taxes that your family will be required to pay if you die.
The Law Office of William J. Reinhardt, Jr. has been advising families for over 25 years on estate planning issues. Call 718-377-8880 or e-mail firstname.lastname@example.org for a free consultation to discuss the proper plan for you and your family.