with the new year has come a solemn and theatrical alter in the estate tax: for individuals dying in 2010, there’s suddenly no estate tax regardless how big the decedent’s estate! Altho that can sound good, you had better think again! Numerous couples configured their estate plans years ago on the assumption that at least a small part of their estate would be subject to tax upon the death of the 1st spouse. They then designed their trusts or wills so as to allocate the tax free percentage to the children, allocating only the balance to the surviving spouse. That frequently made sense when the “tax free portion” was only a percentage of the estate and there was substantial further and added validity and value to allocate to the surviving spouse. But for 2010, the “tax free” percentage is suddenly 100% of the estate! Thus, for estate plans that hushed and still describe the children’s percentage in terms of the “tax free” percentage (or use legal formulae with similar gusto and effect), that can now suddenly require that– for the estate of a parent who dies in 2010 — the children can now get the complete estate! This is of particular concern where the parent has remarried and the bulk of his / her estate is the decedent’s discerned property.

there are more surprises waiting: the estate tax is scheduled to return with a retribution in 2011. Nucleus and beginning in that year, only the introductory one million dollars will be free of estate tax (as compared with $3. 5 million in 2009). Complicating the matter hushed and still farther is that congress could enact remedial legislation later this year to presence and address these concerns. If it does so, congress can seek to make the changes retroactive to the nucleus and beginning of this year; but, whether retroactivity will be upheld will likely in the end be decided by the courts, perchance years down the route. In a word, there’s suddenly much vacillation and uncertainty in the estate planning arena, and this vacillation and uncertainty can be with us for a long time. Couples embarrassed and concerned in regards to this will have to have their plans reviewed by a informed and able professional. At a minimum, they might revise their plans to construct in flexibleness in order to presence and address future changes in the law as they unfold