With tax matters dominating the news this past week, I thought it was appropriate to point out that estate planning is not just all about taxes. No matter what happens with the tax laws, the most significant reasons to complete an estate plan continue to involve family matters, not taxes.
With the recent news about the compromise between the President and Congress, there has been much ado about bypass trust planning. We still have no certainty about what the law will settle on, but my email in-box has exploded with concerns that, if there is not a tax savings, then there will be no reason to use a bypass trust. Well, I can say with certainty that no matter what happens to the estate tax exemption, I will not be getting rid of mine. Why? Because I am a proud member of the first wives’ club, and there is no way the winning member of the “casserole brigade” (a/k/a the new wife), or her children, are getting my half of the estate, no matter what size it is. That will continue to be reserved for my spouse and children. In other words, we use bypass trusts for reasons other than savings taxes.