• 17
  • January
    2012

Estate planning is important for everybody. However, it is especially necessary for Floridians with significant wealth or property. Without careful planning, these individuals could be forced to turn over a substantial portion of their assets to the government in the form of estate taxes.

In 2010, the federal government temporarily raised the estate tax exemption to $5 million for an individual. Although the increase certainly benefits Americans by affording them better control over how their estates are distributed, it has had one notable downside - it has led many people with estates that are sizable, but under the $5 million exemption, to become complacent in their estate planning.

It is important to remember that the $5 million exemption is only temporary. It is set to expire at the end of 2012.

At this point, no one knows what will happen when the exemption expires at the end of the year. Before the temporary raise, the exemption was set at $1 million for an individual and $2 million for a couple.

Estate Planning Requires Long-Term Strategy

Floridians with significant net worth may want to consider ways to take advantage of the high estate tax exemption while it still exists. For example, they may consider making financial gifts to their future beneficiaries. Currently, the estate tax is tied to the lifetime gift exemption, meaning that gifts will be subtracted from the estate tax exemption after death.

No matter what happens in the short-term, it is important to have a proactive estate planning strategy that maximizes the amount your beneficiaries will receive. After all, nobody knows exactly when they are going to die.

It would be a shame for your family to lose the wealth you worked so hard to earn. Contact a Florida estate planning lawyer who can help you keep control over your estate.

Source: Investment News, "Estate Tax Lull May Trap Wealthy," Liz Skinner, Jan. 15, 2012.