Tuesday, May 22, 2012

Minimizing Estate Taxes

Simple strategies to minimize estate taxes:

1. Do not procrastinate. It is tough to plan to avoid taxes when you never get to it before death.

2. Transfer large insurance policies to an irrevocable trust so they pass estate tax free to spouse and children.

3. Give assets away during life rather than waiting until death. Due to the difference in the calculation of gift tax and estate tax, paying gift tax is better than the estate tax.

The article mentions 2 more strategies of limited applicability to most people so I will not summarize them in the interest of brevity.