The Cash Flow Clock: For Retirees - Book - Page 61
The Cash Flow Clock
Estate Tax
We have discussed the three primary tax buckets but
there is another tax that must be considered – the
Estate Tax. This is a tax of up to 40% on the assets in
our estate. The good news is that not many will be
affected by this tax, at least based on current law. As
of 2024, the exemption for the estate tax is $13.61
million per spouse. Only assets exceeding this
amount will be subject to the tax. However, when the
current tax cuts expire at the end of 2025, this
exemption is expected to be cut in half. In the past
several decades, it has been much, much lower than it
currently is. It was only $1 million as recently as
2003. It is important to keep an eye on the estate tax
and understand how it might affect us.
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