The value of the assets of you and your spouse, minus your combined liabilities, is needed to determine whether "estate taxes" may be an important consideration in the preparation of wills (or living trusts) for you and/or your spouse. Federal estate taxes are not usually a factor if the combined value of your estates is less than the federal applicable exclusion amount of $2,000,000. Although your combined assets may be less than $2,000,000 now, future growth in the value of your assets may cause the value of your estates to exceed the federal applicable exclusion amount. With proper planning, you and your spouse can take advantage of two federal applicable exclusion amounts. However, without proper planning you may unintentionally "waste" all or part of one of the two federal applicable exclusion amounts. The Estate Size Worksheet and Tax Calculator is divided into four sections. First, you provide some personal information. Next, you are asked for information regarding the values of current assets and liabilities of you and your spouse. In the third section, you can enter some assumptions about how your investments and other assets may increase in the future because of inflation, investment earnings, and additional savings. In the last section, you can see how much federal estate tax would be owed on the current and future values of your estate, your spouse's estate, and your combined estates. For an explanation of how personal information is used, see the Personal Information topic. |