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Jump higher when you get married thanks -- the increase in taxes.
But she mentioned on her way out that being married is actually good thing for estate planning we gotta find out why when he's at 65.
You're on -- direct partner -- and young is back because that's kind of what we said rate later in life marriage may actually work out -- That's right we -- see a lot of people who maybe have been living together for a long time decide to get married as they get older because there's unlimited marital deduction.
Meaning you -- believe unlimited amount of assets either during your life or at death to your spouse -- -- no state tax and no gift tax that the good news -- -- Basically you had about ten years of complete uncertainty estate planning is -- higher the limitations gotten knowing what to do.
And now in theory they're claiming I guess until they change the -- again.
-- product that's rights and as of five million dollar unified credit which means the -- of an individual can gift during their life or at death.
To another person other than what other -- -- hit -- greatest right so this could be your kids any collection but there's.
Fixed amount of five million dollars.
Now indexed for inflation which is great it's already 5250000.
Dollars the way they define it and I'll go up every year or so between.
A married couple baking -- Ten and a half billion dollars.
In total to their kids or whomever they want without any estate or gift tax and that for now is -- -- and after about that's right doesn't phase out.
The estate tax rate that did go up a little well it was it it went up a little but wasn't as high as it has been historically so it's -- 40%.
So once you go over that by the five million dollars or.
Five to fifty.
It is 40% but it historically had been as high as 55%.
And as low as 35 person this -- -- people with small businesses isn't it.
Big big deal for people with small businesses.
Farms that was a big concern right -- and it also just.
The concerned people had about what is the number going to -- because you don't know when you're going to die.
And so if you need it people were really frozen -- should I do something or should not because I don't even know what the numbers -- -- be so at least we have that certainty.
So people can say I am worried.
About -- -- gifting your in my life -- -- I'm gonna have a number that's bigger than that or not -- -- and that benefited from the three year was I think George Steinbrenner right yeah.
-- another important thing now is a step up in basis so let's explain that that is huge so what every you inherit assets through an estate.
Dirk cost basis -- that -- -- -- -- -- house of securities is considered.
Fair market value at -- of death so no matter what the person who died paid for that.
When you inherit it if you just turn around and sell -- you have no capital gains tax because your cost basis.
Fair market value -- -- somebody with a big stock portfolio that and of itself could be reason to get married that.
Tough as well what did -- even not fair market -- even though husband and wife there's no estate tax.
The surviving spouse even gets the step up in basis -- they get that bonus of the step up.
Even though there was no state tax to pay anyway so really careful planning when you have assets that have low cost basis.
Don't transfer them during life.
Transparent -- I'm tell you best be weddings -- -- yeah.
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