As of January 1, 2011 the Federal Estate Tax is scheduled to tax any estate in excess of one million dollars at 55% of that excess.
Through the use of trusts, both living and testamentary, an individual can plan to mitigate their estate tax liability. For example, an individual worth $2 million can use estate planning techniques to transfer the entire $2 million without paying a Federal Estate Tax. Without using such techniques, $1 million of the estate would be subject to a 55% Federal Tax, in addition to any applicable state estate tax.
If you would like further explanation or have any questions/concerns regarding the Federal Estate Tax, please feel free to contact us.
Matthew J. Maroney, Esq
Cristina Prieto-Maroney, Esq
Maroney Associates, PLLC