Estate Tax a nice positive occurence from the Fiscal Cliff negotiations

While we and many others have crowed about the Fiscal Cliff negotiations formally known as H.R.8 American Tax Payer Relief Act of 2012, there are some really bright spots that need to be given their due. Estate tax rates and levels were held at very reasonable levels.

The current estate tax level established by the Fiscal Cliff resolutions is now $5.12 million to index with inflation in the future. The tax rate on amounts over this level is 40%.

But hold on, it gets even better. With a little handy work completed by appropriate Estate Planning and Wills this level can be doubled for couples, thereby increasing the upper level to over $10 million. Unfortunately this is only available for couples through the use of very simple Testamentary Trust planning.  This work needs to be completed BEFORE the death of a spouse for the most ease but is a far cry from the $600k level of not so long ago.

There you have it, a nice positive from the Fiscal Cliff negotiations to start your week off!

Have a good day and a great start to the week!

JK