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Q&A: What Manner of Estate Planning do I Need if I Won't Have to Pay Federal Estate Taxes?

Estate Matters Tax


What manner of estate planning do I need if I won't have to pay federal estate taxes?

Larry's answer: 

It depends on your situation, how large your estate is (or will be), if you have a spouse and/or children, and so on. Generally, most people who won't end up paying federal estate taxes still need....

  • Will
  • Durable Power of Attorney (DPOA)
  • Advance Directive and Healthcare POA
  • Life insurance (if need to provide for spouse/children)
  • Proper beneficiary designations on retirement plans and life insurance

Depending on the type and amount of assets, your estate and beneficiaries may also benefit from a Revocable Living Trust (RLT) to avoid probate.

While the federal estate tax exemption level is currently $5.43 million per person (for 2015), don't forget to check your own state. As an example, in my state of Oregon the exemption is still only $1 million.

Treat this as general information and be sure to consult an estate planning attorney (or self-help legal service) for specific advice and document drafting.

[A version of this Q&A first appeared on NerdWallet's Ask an Advisor October 15, 2015.]