As part of answering common basic questions we see in our practice, here is one:
When Does Estate Planning Involve Tax Planning?
Estate taxes are imposed upon an estate which has a net value - in 2002 and 2003- of $1 million or more. Under current law, that amount will increase to $1.5 million in 2004 and 2005, to $2 million in 2006 through 2008, and to $3.5 million in 2009. For estates which approach or exceed this value, significant estate taxes can be saved by proper estate planning, usually before death and, in the case of married couples, before the death of the first spouse. Estate planning for taxation purposes must take into account not only estate taxes, but also income, gift, property and generation-skipping taxes as well. Qualified legal advice about taxes should be obtained during the estate planning process.
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Henry (Hank) Moravec is a partner at Moravec, Varga and Mooney. He focuses his practice on Estate Planning, Trust and Probate Administration, Beneficiary and Trustee Representation, Tax Law, and Nonprofit Law.