Estate Tax Insurance

I'd talk to another estate planner and get a second opinion.

But any estate planner worth a shite will do just that, help their clients plan, instead of selling them $1000/month worth of insurance and saying frick it

I have never in my life heard of estate tax insurance...sounds like a massive load of bullshite to me. If your inlaws have an estate that is sizeable enough to trigger taxes, they need to check in with someone who can set up a trust of some kind for them.

FWIW, this would get a LOT higher quality responses on the money board.

They are dealing with a insurance salesman not an estate planner. Anyone with a net worth of a few million dollars needs to set down with actual attorney that specializes in trusts, tax, and estate planning. You indicated there assets were already in a trust, the attorney that set up the trust would be a good place to start.

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Not that I have anything to worry about, but I always wondered why people in jeopardy of paying "estate" taxes, don't somehow shuffle funds and assets around to avoid this.

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They do but at some point your so rich you can't avoid them

Having the assets in trust if it is a grantor trust or revocable trust will not shield them from estate taxes. However, until Dec 31 2025 the estate tax exemption is 11,180,000. Even after that it will be back to the 5.6 MM plus about 2 percent a year for inflation. On top of that the unused exemption is portable meaning a married couple has 22.4 or so million exempt right now. Everything after that will be taxed st 40 percent. If the guy is telling them to personally own the insurance, he is only making their problem worse as the insurance proceeds will be in their taxable estate. Tell them to go talk to an estate planning attorney and get some solid advice.


*nothing in my post is legal advice fwiw...

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My family usually takes their assets and put them in the intended recipient names to avoid the taxes. Mom opened an account in her name with mine on it also.same for the car and house. When she died, everything was already in our (mine and sis) for this reason. But the recipient has to be trustworthy enough that you know they will not touch those assets until after death. It's worked for us for 4 generations. frick paying estate taxes.

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Not how it works. Not saying it didn’t happen... but either the assets didn’t exceed the exemption amount, or the irs didn’t catch it.

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the truly wealthy use irrevocable trust to pass their estates and avoid inheritance taxes

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Kind of. They will gift assets to trust (annual exemption and/or lifetime exemption) and often the trustee will use those assets to buy insurance to cover any tax. However, there are lots of other things people can do to decrease taxes. Discounts are a big deal. FLP FLLC IDIT. If charitably inclined CRTs DAFs and Foundations. Lots of options. If his in laws are facing an estate tax they need a licensed estate or tax attorney to review their stuff.

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I am not that OT Baller but still have to say what a total load of horseshite it is that the government somehow feels entitled to 40% of your assets just because you had the audacity to die.

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You're dead, that's why they go after your money

Everybody bitches about inheritance taxes but due to the generous exemption, almost no one is subject to them. The only "regular"people who need concern themselves are those with a sizable business or family farm.

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Everybody bitches about inheritance taxes but due to the generous exemption, almost no one is subject to them. The only "regular"people who need concern themselves are those with a sizable business or family farm.

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exactly right...I think it is more of a political talking point now than anything else.