UNDERSTANDING ESTATE TAXES CAN SAVE YOU MONEY

All property interests you own are included in your gross taxable estate. To remove property from your estate, you must give up control and all benefits from it. You may use the gift and estate tax credits to pay gift and estate taxes on the first $1 million of wealth you transfer by gift during your life or on $1.5 million ($2 million in 2006) upon your death. In addition to the tax credits, a number of other deductions and exclusions from gift and estate taxes exist, most importantly the unlimited marital deduction and the annual gift tax exclusion amount per year, per recipient. Tax considerations, however, do not occur in isolation and should be incorporated into an overall estate plan.

Effective tax minimization strategies are just one aspect of a sound estate plan. In other tutorials, you will learn about some of the other factors to be considered, and the legal rules and structures (e.g., trusts), to give you a better awareness and understanding of various estate planning tools and techniques available to help you maximize your wishes (both tax and non-tax) in the management and transfer of your property.