Paying your fair share of taxes is one thing, but what exactly is fair? Is a tax that is levied due to the event of your death really necessary and fair?
The above questions are asked by critics of the federal estate tax, which is often referred to as the “death tax.” It is true that the trigger that generates the tax bill is the death of an individual with resources exceeding the exemption amount, so in a very real sense it is a death tax.
One of the arguments that is presented by those who oppose the estate tax is the suggestion that it is a tax that is levied on resources that you have left over after you paid taxes all of your life. So in essence the estate tax is an instance of double taxation, taxing after-tax earnings or gains.
And even if you got past the above feeling as though the estate tax was standing on a logical premise, what about the rate? What would be a fair estate tax rate?
At the present time the maximum rate of the estate tax is 35%, and this is a pretty large number. But believe it or not, the top rate of the federal estate tax is scheduled to rise to 55% in 2013. And no, that is not a typo or misprint.
Philosophizing about the estate tax is one thing, but reacting to it is another. If you want to position your assets intelligently in an effort to gain estate tax efficiency, take action right now to set up an appointment to speak with a good South Carolina estate planning lawyer.