It May Not be Ticking, But……

It May Not Be Ticking, but……….

Perry Douglas West, Esq.

 

            The reality of the Federal Estate Tax with a current Unified Gift and Estate Tax Credit of $11,700,000 may have all but disappeared from the memory of the vast majority of Americans.

            That may soon change for a significant number of families with unexpected and negative to disastrous consequences.  Many of the current proposals in the Congress which are given some chance of passage provide for a reduction in Estate Tax Credit from $11,700,000 to $3,500,000 and a corresponding reduction in the gift tax credit to $1,000,000.00.   Although not exact, these amounts roughly approximate the value of the property you may have at your death without incurring federal estate taxes.    When many people begin to add up the value of what they have now including:  your home, savings, business interests, investments, retirement accounts and generally “the stuff of life”,   they may be surprised to find that they exceed or in many cases far exceed those amounts.    The consequences can be disastrous.   Although there are some exceptions and some provisions for delay of payment on some assets, Estate taxes are generally due and payable to the Internal Revenue Service 9 months from the date of death…in cash.

            It doesn’t take much to consider what the impact would be on an estate with non-liquid assets in excess of the amount of the unified credit when the marginal tax rates for estates in excess of $1,000,000 over the credit are 40% of the taxable estate.

            The time to start planning has come and gone……you need to catch up.

            September 2021

 

Perry Douglas West Chartered

www.perrydouglaswest.com

 

 

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