Beneficiary Designations Can Cause Big Estate Tax Problems
A recent Wisconsin Supreme Court ruling provided a big blow to “simple” Wisconsin probate avoidance plans and reinforced the need for a good revocable living trust by overturning a long-standing state and federal estate tax assumption. The court ruled that anyone receiving an inheritance through a “pay upon death” (POD) or “transfer upon death” (TOD) designation is not responsible for paying their fair share of state or federal estate taxes. Instead, those estate taxes are paid out of the residue of the estate. (http://bit.ly/ax3qLr)