While estate planning is rightly concerned with issues that extend beyond tax matters, the need to address taxation is certainly one of the central themes of estate planning. Rendering tax advice is beyond the scope of an agent's responsibilities, but it is still important for advisers who work in the estate planning market to have a basic understanding of estate taxation.

The federal estate tax is a transfer tax. For a variety of revenue and social purposes, the federal government has long imposed a tax on an individual's right to transfer property to someone (or something) else. Property transferred during life is a gift, and is subject to potential gift taxes. Property transferred at death is subject to the estate tax. Both gift and estate taxes are collectively part of a transfer tax system. A third transfer tax, the generation-skipping transfer tax (GSTT), targets property transfers to grandchildren and other so-called "skip" beneficiaries.

(NOTE: It is the donor (not the recipient, or donee) that is responsible for payment of the transfer tax.)

Back to Top | Next

Ohio National is not affiliated with, nor does it endorse or sponsor, any particular prospecting, marketing or selling system.

48