Should the Death Tax Die?

Most discussions of the estate tax, better known as the death tax, ignore the green monster in the room. Obviously, envy is involved. Since a legislative compromise in 2013, the death tax is 40% on the amount of the estate over $5 million dollars. The $5 million is indexed for inflation and is currently about $5.4 million. You can’t get out of death tax by giving your money away to your children before you die. In that case there is a gift tax. The gift tax and the death tax share the same $5 million limit. There is no gift tax or death tax for transfers of money between spouses. By proper structuring of their estates, a married couple can leave up to $10 million (indexed for inflation) without death tax to their children, or anyone else for that matter. In addition you can give up to $14,000 in any year (also indexed for inflation), to anyone, without it being deducted from your $5 million lifetime allowance. A married couple can give away $28,000 each year to as many people...(Read Full Article)