JK Lasser's New Rules for Estate, Retirement, and Tax Planning, 6th Edition
by Stewart H. Welch III, J. Winston Busby
CHAPTER 8Using Trusts in Your Estate Plan
In Chapter 7, we reviewed the key elements that should be considered in all wills. At what point should you consider more complex estate planning? Additional planning is appropriate if you feel it is desirable to maintain some control over your property after you die. In this situation, establishing one or more trusts under your will may be advisable. Also, if you are married and the total of your and your spouse's estates (including life insurance death benefits) exceeds the applicable exclusion amount, you need to consider a more complex will. As you recall from the previous chapter, two important tax strategies may be available to you.
The first strategy, available only if you are married to a U.S. citizen, is called the unlimited marital deduction (or simply the marital deduction). Under federal tax laws, you may give an unlimited amount of assets to your spouse without incurring gift or estate taxes. These gifts can be made during your lifetime or at your death. This means that Bill Gates, reportedly one of the richest people in the world, could give or leave his entire fortune to his wife and the estate would not owe a dime of federal estate taxes. However, when she dies, taxes would be due. The marital deduction is available to legally married same‐sex couples now that the Supreme Court declared Section 3 of the Defense of Marriage Act unconstitutional. We discuss strategies associated with the marital deduction later in this chapter. ...