Estate Planning

More Challenging Than Ever

estate planning Estate planning is more challenging than ever.

Many thought that here in the USA estate tax issues would be reduced when Congress passed a new law in 2001 that gradually phases out Estate Tax until 2009 and finally repeals it altogether in 2010. Click over to Estate Tax to see exactly what the estate tax is, who actually pays it, and learn how it gradually phases out in the next few years.


Congress left in a nasty little time bomb. If Congress itself doesn't take further action, estate tax is reinstated in 2011 with the exemption at $1 million. In other words, the estate tax repeal will itself be repealed.

That uncertainty over what Congress might do means that planning for your estate is still necessary, and has to take place in three different scenarios:

  1. Now to 2009. Exemptions rise from $675,000 in 2001 to $3.5 million in 2009;
  2. 2010. Estate tax is fully repealed for this year;
  3. 2011... what if...?

    • Congress does nothing - estate tax is automatically reinstated with only a $1 million exemption
    • Congress actually moves to make the repeal permanent. On April 27, 2005, the House voted to end the death tax after 2010, but it is uncertain that the Senate will also vote to end, having blocked previous House efforts to end the tax.
    • Congress opts for something "in between" - keeping the death tax but altering the rate of tax and / or the exemption amount.

So, how should one handle estate issues under these different scenarios?

Flexible Estate Plan Needed

Concepts, Tools and Techniques of Estate Planning

Read our reviews of some of the concepts, tools and techniques that are necessary for dealing with estate issues.

Succession Management

Gift Tax

Wills and Trusts

Asset Protection

Family Trusts

Living Trusts

Living Trust Will

Revocable Living Trusts

Providing for A Child With A Disability

Special [or Supplemental] Needs Trusts

Charitable Remainder Trusts

Insurance Trusts

Family Limited Partnership

Bottom line

"Estate strategies are a crucial exercise for every family business" according to top family business expert Don Schwerzler. "Without smart planning, the family business can be wiped out by the estate taxes."

Schwerzler has been studying and advising family businesses for more than 40 years and he is the founder of the Family Business Institute. To properly do an estate plan, scenarios and solutions will vary from one family business to another. Each is unique and complex in its own way. Our family business experts facilitate the process by acting as "quarterback" for the team of professional service providers - professionals such as financial planners, attorneys and accountants.

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