Changes … Estate Tax Relief Until 2012!

From San Diego Will and Trust Attorney, KR Hess Law, Kristina Hess

You Need to Review Your Trust

Seriously, I didn’t think it would pass … but I guess I underestimated the power of politics …

We have a 2 year extension … Estate Tax Relief until December 31, 2012.

What this means is that if you or your loved ones die between now and the end of 2012, you can pass $5 million to your heirs tax free! Then, what is over will be taxed at 35%.

So, this is good news for many San Diego Families … who were facing the prospect of a 55% tax on assets over $1 million.

However, 2 years isn’t a long time, so we will have to see what the long term picture looks like.

Ultimately, this only reinforces the way that we practice law — and that is to regularly review our clients’ trusts and estate plans to make sure they are up to date.

Those of you who have an old trust design with A-B automatic formula funding of the Bypass Trust, will probably want a more flexible design because estates under $5 million will see that no tax advantage is preserved (more on this).

Bottom line is we need to update your plan if you have an older trust design.

During January we will be providing free trust reviews (normally $499 for a complete trust review).  So, if you have an older trust, you will want to call Sarah, my client services director and get on calendar for January Trust Review.

Let’s make sure your plan will always work, no matter what the tax environment is!