Estate Planning Comment of the Week

WEEK OF: December 3, 2006

                                    REPEAL OF THE ESTATE TAX

With all of the talk about the repeal of the federal and state estate taxes, some people may decide they don't need to do estate planning. You may have heard or read that, under the Economic Growth and Tax Relief Reconciliation Act of 2001 the federal estate tax will phase out by January 1, 2010*. Well, planning for the estate tax is only a very small part of estate planning. In fact, due to the exemptions from both state and federal estate taxes ($1.5 million federal and $950,000 Oklahoma), many estates do not even pay an estate tax. Therefore, don't let all of this talk about repealing the tax keep you from preparing a carefully documented distribution of your estate. Estate planning offers you much more than just tax protection! It can provide probate and guardianship avoidance, asset protection, and income tax benefits. Therefore, do your estate planning NOW. Tomorrow could be too late.

* The provisions of this tax act end effective January 1, 2011. Therefore, unless Congress changes something, the tax returns in 2011 at the 2002 rates (with a $1 million federal and state exemption)!