Estate Planning

You work hard for your money, so who do you want to leave it to when you die ? the government or your kids? Even if you don?t consider yourself ?rich,? you need to know how to protect yourself against estate taxes.

Alexis Martin Neely, a personal family lawyer and creator of the Family Wealth Planning Institute, explained on Wednesday?s show (September 10, 2008) that the government can take up to 45% of your assets if they total over $2 million, and that rate is set to climb to 55% in 20011 if you are worth more than $1 million. But even if you don?t make close to that much in salary, you?d be surprised how your assets can add up. The government considers home equity banking and brokerage accounts, retirement savings and life insurance policies all to be part of your estate. That makes it much easier for the average American to suddenly become a millionaire in the eyes of Uncle Sam.

The best thing you can do to prepare, according to Neely, is to set up a family living trust and make sure you have the provisions in there to protect your assets from being taxes to high heaven. There are even lawyers who can legally find ways to make your assets look 30-40% less than they actually are in the eyes of the government.



So nothing is certain but death and taxes, right? Oh yeah, and a tax upon your death. Better get your house in order.

To see Alexis' September 10 appearance on CNBC's On The Money with Carmen Wong Ulrich, click here.

SOURCE: CNBC.com