Careful estate planning can be used to reduce the tax burden on assets that are intended for the next generation. Georgia residents may want to know if estate planning is necessary if the federal estate tax will be repealed as promised by the current presidential administration.
The estate tax laws that are currently in place and set the federal estate tax at 40 percent often change. For 2017, the exemption is $5.49 million for individuals and $10.98 million for married couples. As a result, very few people will have to tax this into consideration even if it is not repealed. However, they still need to focus on ways to protect their assets for their beneficiaries.
Whether or not there is a federal estate tax, it is important to be knowledgeable of estate planning basics. The elimination of the estate tax does not help individuals with deciding who will receive their retirement benefits, assets or life insurance funds. It is important that there are medical and financial powers of attorneys in place in the event individuals become incapacitated. People may want to put the appropriate measures in place to ensure their heirs are able to access their assets only under certain conditions. Also, the guardianship of children has to be determined, particularly if there are children with special needs.
An attorney can examine a client’s finances and recommend certain estate planning documents that can ease other tax burdens even in the absence of estate tax. As an example, there are rules regarding retirement accounts that should be taken into account.