Posted on Jan 12, 2009
The Wall Steet Journal reported today what we have been saying for a long time.  That is, that the new government will not allow the state tax repeal to take effect and that the most likely plan will be to freeze the current levels.

According to the WSJ - "Under the Obama plan detailed during the campaign, the estate tax would be locked in permanently at the rate and exemption levels that took effect this year. That would exempt estates of $3.5 million -- $7 million for couples -- from any taxation. The value of estates above that would be taxed at 45%. If the tax were returned to Clinton-era levels, it would exclude $1 million from taxation with the rest taxed at 55%."

What does this mean to American taxpayers and families?  Well, essentially, if you have more than $3.5 million of assets (or as a couple, if your individual and marital ssets exceed $3.5 and this includes life insurance), then federal estate tax planning is still an important issue and should be considered in your planning and your revised plan documents.

If your estate values (including life insurance and retirement assets) are under this amount, then planning to protect your surviving spouses, children, and your heirs from divorce, lawsuits and state death taxes should remain your focus.

Under our Enhanced Estate Planning Programs (TM) you can also make sure to protect your family knowledge base, your business and personal values as well as your wealth and assets.

Congress is expected to act early on these issues, and once they do consider reviewing your plan with your advisors to avoid it becomming outdated by the changes.  You should also review retirement account and insurance beneficiary designations to make sure that they are integrated and match your plan documents.

David M. Frees III, Esquire
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David M. Frees, III
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Attorney, Speaker and Author