1. With the federal estate-tax exemption up to $10.6 million for couples, passing money to your heirs estate tax free is not a worry for your average American taxpayer. The increasing concern is minimizing income taxation for both yourselves and your heirs. Chapter 11 is essential reading as your old estate plans may be out-of-date and potentially dangerous to your planning.
2. Don’t be so sure you can count on inherited IRAs to stretch your assets for generations. Congress has tried to eliminate this lucrative planning tool in the past and may still succeed in changing the laws that make it possible. If this happens, you have to know what other courses are available to you and your family. Jim encourages readers who plan to use this strategy to read chapter 13 carefully.
3. Although many people cringe at the mention of life insurance, this tool takes on a new importance with the higher tax rates and potential death of the “stretch” IRA. Life insurance remains the most tax-efficient way to pass wealth to the next generation, efficient and tax-free! Chapter 12 discusses these vehicles in detail. One critical point for insurance cynics to understand is that insurance premiums, even if they last a long time, is almost always less expensive than the additional taxes your heirs would pay without buying the insurance.
4. Inaccurate beneficiary designations can trigger massive income taxes and family feuds that can last generations. People might know who their beneficiaries are and who they should be. But to make sure that the law agrees with who you think your beneficiary should be, read chapters 15 and 16. Some of the most massive and unnecessary tax mistakes we’ve seen are rooted in this issue.
5. Do not make the mistake of failing to divest in highly appreciated stocks due to a fear of capital gains tax. Changes to the tax laws in 2012 reduce the impact of the capital gains tax. For lower income taxpayers, capital gains tax is eliminated. The risk of keeping all of your eggs in one basket dramatically outweighs the tax liability for most people. So, if you are one of those people that have not diversified your portfolio because of this tax, please read chapter 4. You may change your mind!
Here is What Experts Are Saying About Retire Secure!
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Charles R. Schwab, The Charles Schwab Foundation
“A road map for tax-efficient retirement and estate planning.”
Jane Bryant Quinn Newsweek/Bloomberg.com
“Retire Secure! (2nd) covers two areas particularly well—Roth IRA conversions and estate planning for IRA owners.”
Roger G. Ibbotson Chairman, Ibbotson Associates
"Retire Secure! is a very practical investment guide on how to defer taxes and efficiently plan for retirement and your estate.”
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