 |
| |
 |
| |
 |
| |
 |
 |
The first benefit of a marital trust is that assets owned by the
trust will not have to go through probate. There will be no
expensive probate costs or lengthy delays.
The second benefit is that an A&B trust will maximize your
estate tax exemptions. In 2008, there is a $2,000,000 estate tax
exemption per spouse. That exemption increases until 2010
when there is no estate tax; and then in 2011, the estate tax is
right back at the $1,000,000, and taxed at a rate of 55%.
This tax cut was part of the Bush tax cuts. However, the
Democrats now wish to eliminate these tax cuts, and allow them
to expire in 2011.
Exemptions and Maximum Tax Rates
Year Estate Tax Exemption Highest Rate
2008 $ 2 million 45%
2009 $ 3.5 million 45%
2010 N/A (taxes eliminated) 0%
2011 $ 1 million 55%
An A&B trust can preserve the million dollar tax exemption for
each spouse, allowing more of the estate to pass to the heirs. If
you have an estate of $4 million, and one spouse, the entire
estate will then become the property of the surviving spouse
without taking advantage of the tax exemption. The current
pending estate tax exemption dies with that spouse, and the
remaining spouse is then left with only the exemption in place
when they die.
Essentially, this means that your heirs, children and
grandchildren have to pay taxes on $2 or $3 million they
shouldn't have. This amounts to a tax bill of $1,100,000 or
$1,650.000.
trust will not have to go through probate. There will be no
expensive probate costs or lengthy delays.
The second benefit is that an A&B trust will maximize your
estate tax exemptions. In 2008, there is a $2,000,000 estate tax
exemption per spouse. That exemption increases until 2010
when there is no estate tax; and then in 2011, the estate tax is
right back at the $1,000,000, and taxed at a rate of 55%.
This tax cut was part of the Bush tax cuts. However, the
Democrats now wish to eliminate these tax cuts, and allow them
to expire in 2011.
Exemptions and Maximum Tax Rates
Year Estate Tax Exemption Highest Rate
2008 $ 2 million 45%
2009 $ 3.5 million 45%
2010 N/A (taxes eliminated) 0%
2011 $ 1 million 55%
An A&B trust can preserve the million dollar tax exemption for
each spouse, allowing more of the estate to pass to the heirs. If
you have an estate of $4 million, and one spouse, the entire
estate will then become the property of the surviving spouse
without taking advantage of the tax exemption. The current
pending estate tax exemption dies with that spouse, and the
remaining spouse is then left with only the exemption in place
when they die.
Essentially, this means that your heirs, children and
grandchildren have to pay taxes on $2 or $3 million they
shouldn't have. This amounts to a tax bill of $1,100,000 or
$1,650.000.
Esmeralda, Nevada County Courthouse