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Article:

Make Expiring Tax Cuts Work for You

Know What Changes Are Coming in 2013 & How You'll Be Affected

Estate Taxes

What's going on: The estate tax -- often referred to as the "death tax" -- is paid by heirs who inherit significant assets. Right now, the tax only applies to estates worth more than $5 million, a level that means very few Americans are affected by this tax. However, that threshold is set to drop to $1 million at the end of 2012. Furthermore, the estate tax rate could also jump from 35 percent to 55 percent.

How you can prepare: Even if the exemption drops to $1 million, very few of us need to worry about this one. But if you think you might, ask a tax professional to look at ways to reduce the size of your estate through gifts to intended heirs, charitable donations and the creation of trusts.

 

  • Sarah Shemkus

    Sarah Shemkus is an award-winning freelance journalist, marketing enthusiast, accomplished baker, occasional globetrotter and total nerd (with a particular fondness for spreadsheets). Most recently, she reported on business and real estate … Read more...