The Living Trust Advisor

CHAPTER 13 Dealing with the Estate Tax Return, Splitting the Living Trust Assets, and Other Tax Stuff That You Would Rather Just Ignore after Your Spouse Dies Or, As Much as You Want to, Don’t Skip This Chapter! To Prevent Estate Taxes after Your Death, You Must Deal with Estate Tax Matters after Your Spouse’s Death

The mere words estate tax may make you run screaming for the hills in boredom. Well, perhaps I should not assume what accounts for your running and screaming. For me, it’s boredom. For you, it may be anger that comes from having to deal with tax stuff after your spouse has died. For others, perhaps it is fear of the prospect of having to tangle with the Internal Revenue Service (IRS) in the estate tax arena, a completely different venue than the normal income tax area with which you have some familiarity.

The estate tax stuff is one of the reasons you established your Living Trust in the first place. Even though there is usually no estate tax due on the death of the deceased spouse, there still may be estate tax stuff that needs to be done so that little or no estate tax will be due when the surviving spouse dies. Put another way: You paid for it. You might as well become familiar with what you paid for.

What Is the Estate Tax?

The estate tax is a federal tax on the after-death transfer of your assets and wealth to your Living Trust beneficiaries and the beneficiaries of your assets outside your Living Trust such as insurance policies, individual retirement accounts ...