Life insurance can be a great tool to ensure that your loved ones are cared for after you are gone.  But often, Uncle Sam becomes the recipient of as much as half of the life insurance proceeds. How can you make sure your life insurance benefits go to your family after your death and not Uncle Sam? This is important because, once the Federal Estate Tax kicks in, the rate is high (currently 45%). Your life insurance will be included in your taxable estate if either (1) your estate is the beneficiary of the insurance proceeds, or (2) You possessed certain economic incidents of ownership in the policy at your death (or within three years of your death, often referred to as the

Filed under: Estate Tax Planning by Myrna Arroyo | No Comments »