One of the many financial factors that people must consider during their lifetimes is the possibility of estate tax or inheritance on possessions they leave behind after death. We are all subject to various taxes during our lives including a gift tax on gifts of money or property that we give or receive. But the taxes that are imposed on your estate and its beneficiaries after you pass. The estate includes everything you own when you died including the proceeds from your life insurance policy, if you are the owner of a life insurance policy. This is why talking to an unbiased expert, like the life insurance specialists at the BeamaLife, is so helpful when preparing your estate and considering the possibilities of estate tax.

Estate tax can be levied on many different assets. For federal estate taxes, your gross estate includes all real property such as real estate, investments, business interests and personal property that you own at the time of your death. It also includes property you’ve given away but still used or had a vested interest in during your life, gifts that aren’t dispersed until after your death, your one-half interest in community property, annuities, pensions, profit-sharing plans and your share of any property owned jointly.

Many people don’t even realize that estate tax can also be levied on the proceeds from their life insurance. Any life insurance policy that you own at the time of our death, including policies for which you retained the right to change the beneficiary, cancel the policy or make policy loans with, can potentially be taxed. The life insurance experts at BeamaLife can explain how your life insurance policy will be affected by estate tax though, and since they represent more than 100 different highly rated life insurance companies and are not paid on commission alone, they are not biased towards one type of policy or one specific company. It pays to have guidance when choosing a life insurance policy and structuring it right.

If you believe that your assets will be hit hard by estate tax and you want to protect the gifts you plan to leave your loved ones, there are many ways you can minimize estate tax. It is always advisable to speak to an estate tax attorney before making any decisions, though. Without proper planning, lifetime gifts can potentially trigger gift tax. A tax & legal expert can advise you about whether a gift will trigger this tax, but generally you can count on certain gifts not triggering the tax, including gifts made to U.S. citizen spouses and certain charities, those worth $133,000 or less made to non-U.S. citizen spouses, certain payments on behalf of others for tuition or medical expenses and those under the annual gift tax exclusion amount of $13,000. Gifts under the gift tax applicable exclusion amount of $1 million will also not be hit by gift taxes, but they will reduce the applicable exclusion amount for estate taxes.

Whether it’s a life insurance policy or any other types of property, many people choose to transfer their assets to an irrevocable trust in order to reduce estate tax liabilities. This may also be hit by the gift tax, but the estate tax will not apply, so if the assets increase in value they still won’t affect the estate. And with financial guidance from BeamaLife, you can fund your estate tax liabilities with a life insurance that benefits you and your beneficiaries to the fullest. It’s important to have this type of unbiased advice from an impartial source that has the knowledge to assist you in your estate and policy ownership decisions so your loved ones will be taken care of. Please call (866) 972-3262 to speak with a specialist or complete this short life insurance quote request form now.