If you are not aware of the extent of the federal estate tax, the details may come as something of a shock to you. The powers that be are potentially poised to consume an enormous portion of your resources after you pass away, and as a case in point, look no further than the estate of the entertainment impresario Dick Clark.
Clark passed away a very wealthy individual, with an estate that is estimated at well into the hundreds of millions of dollars. The estate tax exemption is currently $5.12 million; this is a drop in the bucket for somebody with the kind of wealth that Dick Clark had at the time of his passing.
The maximum rate of the estate tax this year is 35%. So, the heirs to the Dick Clark estate are faced with the prospect of parting with 35% of hundreds of millions of dollars.
It should be noted that as confiscatory as this may sound they’re getting off easier than they might have had Clark survived until next year. At the end of 2012, the top rate of the estate tax is scheduled to rise to 55%, and the exclusion is set to be reduced to $1 million.
The good news it is that there are steps you can take to reduce your estate tax liability, and we have to think that Dick Clark was prescient enough to plan his estate accordingly. If you would like to do the same, simply take a moment to arrange for a consultation with an Ashland KY estate planning lawyer.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
- What You Need to Know about the Medicaid Look-Back Rule - January 3, 2023
- How to Pass Down Your Legacy in Your Estate Plan - October 3, 2022
- Practical Steps to Take after Receiving a Terminal Diagnosis - September 30, 2022
