When Alice (who asked that her real name not be used) and her husband bought their vacation home 1983, they knew it was special: a 4,500 square foot beachfront house in the Crystal River, Florida area, with views of the sunrise, the sunset and the Gulf of Mexico.
For those whose loved ones died in 2010, this is the time to wrap up their estates. Last year was an unusual year — the estate tax disappeared altogether to the benefit of some and the detriment of others. But in its absence, a different capital gains tax emerged. That means anyone sorting out a 2010 estate now gets to choose which tax to pay.
Now that the Washington tax deal is law, most Americans don’t need to worry about estate taxes – so long as they don’t die in the next two years. The agreement between President Obama and Republican lawmakers ends the current uncertainty on estate taxes with an ultra-generous $5 million exemption per individual, with estates over that amount taxed at a 35 percent rate.