A part of any retirement savings plan includes something about the great beyond that comes afterwards. What happens with all that you have that you want to leave your heirs? What is the best way of doing that? Estate taxes are about the most unforgiving demand on your retirement savings plan out there. They are not being done away with, if that was what you were hoping for.

They expect that the tax will come back this year and everyone is trying to find ways around it. One possible option is how you can give your heirs a gift now. You are allowed to give them $1 million apiece, and not pay any taxes; if you make a gift that is greater than that, you pay a 45% gift tax. So why should you go pay that 45%? Isn’t this about avoiding taxes? Well, estate taxes are usually deducted like income tax. But a gift tax you could pay now, you would see applied like a sales tax. You do have to pay some kind of tax either way; but with the gift tax, you save $5 million. Give now instead of later through your will and estate, and you save.

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