Estate Planning

The federal estate tax rate is a graduated tax ranging from 18% to 40%, applied only to the portion of an estate exceeding the lifetime exemption amount.

Yes, you can leave everything to your spouse free of federal estate tax using the unlimited marital deduction, as long as your spouse is a U.S. citizen.

No, the marital deduction generally does not apply if your spouse is not a U.S. citizen — unless you use a Qualified Domestic Trust (QDOT) to defer estate tax.

In 2024, you can leave up to $13.61 million to your heirs free of federal estate tax; married couples can shield up to $27.22 million.

Portability allows a surviving spouse to use any unused portion of their deceased spouse’s federal estate tax exemption, provided the executor files IRS Form 706 and makes a timely election.

The generation-skipping transfer tax (GSTT) is a federal tax imposed on transfers of property to beneficiaries who are two or more generations younger than the transferor — such as grandchildren — to prevent avoidance of estate and gift taxes across generations. It applies in addition to, and at the same rate as, the federal estate tax.

No, you cannot fully disinherit your spouse under federal estate tax rules because the marital deduction allows unlimited transfers to a surviving spouse tax-free — but only if the bequest qualifies under IRS requirements.

No, there is no federal inheritance tax in the United States. The federal government imposes only an estate tax—not an inheritance tax—on the transfer of a deceased person’s assets.

Yes, the IRS can place a federal tax lien on your estate for unpaid federal taxes—including estate tax—once the liability is assessed and notice is given.

Yes, you may defer estate tax payments for up to 15 years if your estate includes a qualifying family business, under IRC § 6166 — but this provision is not in the cited § 2001 statute.

Yes, you can gift money to your children during your lifetime to reduce your estate tax, but gifts above the annual exclusion amount count against your lifetime unified credit — which in 2024 is $13.61 million per person.

The annual gift tax exclusion amount is $18,000 per recipient for 2024, and it is adjusted annually for inflation.

A charitable remainder trust (CRT) is an irrevocable trust that pays income to non-charitable beneficiaries for life or a term up to 20 years, then distributes the remaining assets to charity; it reduces estate taxes because the remainder interest passing to charity qualifies for an estate tax charitable deduction under federal law.

Generally, no—you cannot change the beneficiary on a qualified retirement plan (like a 401(k) or pension) without your spouse’s written consent if you are married and the plan is subject to ERISA.

When you die, your 401(k) or IRA passes to the beneficiaries you named — not through your will — and is subject to required minimum distributions and tax rules for heirs.

Yes, ERISA broadly preempts state law claims relating to employee benefit plans, including retirement benefits, to ensure uniform national standards.

Roth IRAs offer significant estate planning advantages: tax-free growth and withdrawals for beneficiaries, no required minimum distributions (RMDs) during the owner’s lifetime, and the ability to pass tax-free assets to heirs.

A required minimum distribution (RMD) is the minimum amount the IRS requires you to withdraw annually from certain retirement accounts starting at age 73 (or 75 if born in 1960 or later), to ensure taxes are paid on tax-deferred savings.

The SECURE Act eliminated the 'stretch IRA' for most non-spouse beneficiaries, requiring them to withdraw all funds from an inherited retirement account within 10 years of the original owner’s death.

Beneficiary designations on retirement accounts and life insurance policies generally override conflicting will provisions, especially for ERISA-covered plans.

Stepped-up basis is a tax rule that resets the cost basis of inherited property to its fair market value at the date of the owner’s death, reducing or eliminating capital gains tax for heirs when they sell.

Putting your house in a trust may help manage estate tax liability, but it does not automatically avoid federal estate tax — the trust type, your control over assets, and timing all matter.

Yes, life insurance proceeds are included in your taxable estate if you owned the policy or had any incidents of ownership at the time of death.

Yes, a retirement plan fiduciary can be held personally liable for investment losses caused by breaches of their ERISA duties, including failing to act prudently or solely in participants’ best interests.

Your 401(k) plan administrator is a fiduciary under federal law and must act solely in the interest of plan participants and beneficiaries, with prudence, loyalty, and diligence.