How can an estate plan avoid or minimize estate taxes?
Everyone gets a “credit” against Federal Estate Taxes on an exemption amount of $2 million in 2006, 2007 and 2008. (Unless previously used up, in whole or in part, as a result of gifts of more than $12,000 to any person in any year starting in 2006. Individuals and married couples with a total estate value less than the current exemption level don’t have to worry about Federal Estate or Gift Tax (the exemption amount slowly increases in steps to $3.5 in the year 2009 but then drops back to $1 million when the estate tax is reinstated in 2011). For those who are married, there is an unlimited marital deduction. All estate taxes can be avoided upon the death of the first spouse to die. However, the surviving spouse would have to remarry and give his/her entire estate to the new spouse in order to get another unlimited marital deduction. Most people would rather their children or other relatives benefit from the estate than a new spouse and his/her family. An estate plan can take advantag
