For Clients, Business Owners and Professional Advisors
I conducted my annual estate planning seminar for financial professionals
yesterday. There was some discussion about Illinois’ dirty little
secret. It’s called the Illinois estate tax. It may affect you and
Take a minute and do a quick calculation. Total up the value of:
- Your interest in your home
- Your life insurance policies (the death benefit)
- Your retirement plan accounts
- Your other investments and Illinois based
How much is the total? If it’s more than $2,000,000, then your estate
will be subject to the Illinois estate tax! The tax is 8% at $2,000,000
and rises to 16% over $10,000,000. Many individuals are surprised to learn
that their families might be subject to this tax.
Illinois has chosen to “decouple” from the Federal tax scheme
which – at least for the next two years – grants a $5,000,000
exemption per person from the Federal estate, gift and generation transfer tax.
There are legitimate ways of avoiding the Illinois estate tax for married
couples. However, it may require planning separate and apart from the
Federal estate tax.
This is an important topic that is part of a thorough estate plan review.
Many families have wills and trusts that may be outdated or that have
not addressed Illinois’ “Dirty Little Secret”. They
should be reviewed at an early date.