with the modern year has come a solemn and theatrical alter in the estate tax: for humans dying in 2010, there’s abruptly no estate tax irrespective how huge the decedent’s estate! Altho that can sound good, you had better think again! A lot of couples set up their estate plans years ago on the assumption that leastways 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 allocation to the children, allocating only the remainder to the surviving spouse. That often times made sense when the “tax free portion” was only a allocation of the estate and there was significant further and added validity and value to allocate to the surviving spouse. But for 2010, the “tax free” allocation is abruptly 100% of the estate! Therefore, for estate plans that hushed and still describe the children’s allocation in terms of the “tax free” allocation (or use legal formulae with alike gusto and effect), that can now abruptly require that– for the estate of a parent who dies in 2010 — the children can now get the whole estate! This is of particular concern where the parent has remarried and the bulk of his / her estate is the decedent’s separate property.

there are more surprises waiting: the estate tax is scheduled to come back with a payback in 2011. Nucleus and beginning in that year, only the basic one million dollars are going to be free of estate tax (as equated 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 are going to be upheld will likely in the long run be decided by the courts, possibly years down the path. In a word, there’s abruptly 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 regarding this will have to have their plans reviewed by a informed and competent professional. At a minimum, they might revise their plans to build up in flexibility in order to presence and address future changes in the law as they unfold