Death and Taxes (and Insurance?)
Was it Mark Twain or Ben Franklin who famously stated it is “impossible to be sure of anything but death and taxes?”
Actually, the correct answer is neither!
Ben Franklin penned a 1789 letter to French scientist Jean-Baptiste Leroy regarding the United States’ new constitution. In his letter, Ben shared that while he hoped for the new document’s permanency, “nothing can be said to be certain, except death and taxes.”
However, nearly 75 years earlier, an English actor during his performance of The Cobbler of Preston uttered “tis impossible to be sure of anything but Death and Taxes.” That man was Christopher Bullock. As for Mr. Twain, although he has many famous quotes, he is often mistakenly attributed to this quote.
Regardless of who spoke these famous words, they remain true to this day. And after the modern estate tax was enacted in 1916 in the United States, the words “death and taxes” have never been more intertwined.
While most Americans will never need to be concerned with paying estate taxes after their passing, those that do may be required to pay a significant sum without proper planning.
For tax year 2022, the estate tax threshold sits at $12.6 million. This is a large figure to be sure. However, since the estate tax is applied mostly to unrealized capital gains, owners of small businesses, farms, and property are most at risk.
Take for example a family property purchased for $1 million 50 years ago which is now worth $20 million. Since the property has appreciated $7.4 million above the current $12.6 million threshold, that exceeds the amount may be subject to a 40% estate tax, or nearly $3 million. For those without a plan, selling the property may be the only way to pay the IRS.
There are many financial vehicles available to help reduce or eliminate estate tax burdens. One such way is to purchase life insurance to satisfy the potential tax debt. For a mere fraction of the possible tax that would be imposed, life insurance can help heirs avoid liquidating property unwillingly.
Featured Blogs
- Long-term Health Benefits of Physical Activity
- How to Trim Down Hidden Costs of Flying
- Best foods for hydration
- How to Experience Positive Aging (8 Tips)
- How to Improve Your Health: The 5 Main Aspects of Wellness
- How much should you actually have in savings?
- Are you underinsured for your circumstances?
- How to Build Sustainable Wealth
- How to Maintain Our Body
- Enhancing Resilience as We Age
- The Body After 60: Overcoming Barriers to Exercise
- The best herbs to grow for beginners
- Foods you had no idea you could freeze
- Is celebrating your 100th birthday no longer a dream?
- Medicare and Medicaid: Dual eligibility
- Summer Workouts for Your Dose of Vitamin D
- What’s Keeping You from Losing Weight?
- Music and Your Wellbeing
- Your NEW Social Security Statement
- How to Dispose of Unused Medications
- Smart Home Systems: Promoting a Comfortable Environment for Seniors
- Aging and Our Body’s Ability to Heal Itself
- Keeping Health Insurance After a Layoff
- Waking Up to the Impact of Insomnia
- How Life Insurance Benefits Women
- What experts say about raising the retirement age
- Coverage for healthcare treatment denied? Here's what you can do.
- Sharing the Road with Cyclists
- Buying Life Insurance for an Elderly Parent?
- Living Your Best Life After 60
- Buying Health Insurance: A Millennial’s Guide
- Self-Love Ideas for Valentine’s Day
- Life Without Clutter
- Set Yourself Up for Success with Your Fitness Routine
- Winter Hydration – Do I Need It?
- I’m 60+; Do I Need Life Insurance?
- Why Do I Keep Breaking My New Year's Resolutions?
- Closing Out the Year with a Smile!
- How to Enjoy a Long Layover
- 6 Cold Weather Safety Tips
- 10 Tips for Managing Cholesterol Levels
- How Much Life Insurance Do You Need Right Now?
- 3 Top Tips for Better Posture
- Building Bone Density for Seniors
- Living Outside Your Comfort Zone in Retirement
- 3 Top Habits that Lead to a Happy Life After Retirement
- Should You Insure Your Gifts?
- Everything You Need to Know When Retiring Under 65
- 7 Benefits of Slow Travel
- Utilizing Medicare Preventative Services
- The Harsh Reality of Credit Card Fees
- Keeping Your Health Insurance Affordable
- 7 Tips to Weather Challenging Periods in Your Life
- What is a Variable Annuity? 4 Key Details You Should Know
- 4 of the Best Ways to Stay Healthy this Summer
- How to Prevent Sun Damage to Your Eyes
- 3 Tips for Safer Grilling
- When the Sun is NOT Your Friend (What You Need to Know about Sun Exposure)
- Tips to Avoid Stress Eating
- Common Exercise Pains – How to Work Past Them and When to Call for Help
- Signs Your Identity Has Been Stolen (and what to do about it)
- How Does Inflation Affect Life Insurance?
- Know the Benefits of Walking
- Do Brain Food Supplements Really Work?
- Ways You Can Spend Less on Gas
- What Are Alternatives if LTC isn't Right for You?
- 4 Tips for a Less Stressful Summer
- Veteran and Medicare Benefits Work Together
- What are the Safest States From Natural Disasters?
- How to Choose an In-Home Care Provider for Your Loved One in 5 Steps
- 7 Myths About Your Back Pain
- How to Prepare for Retirement Considering Inflation
- 5 Foods that Will Help Keep Your Mind Healthy
- Don’t Throw Away Those Used Coffee Grounds
- I’m 50 Years Old. Should I Keep My Life Insurance?
- Are Personal Items Covered by My Auto Insurance Policy?
- How to Spot Government Imposters
- 5 Mistakes to Avoid When Buying a Life Insurance Policy
- Do I Really Need Condominium Insurance?
- Happiness Through Healthy Food
- 5 Step Checklist to Choosing a Health Insurance Plan
- The Cost of Home Ownership
- 5 Creative Spring Décor Ideas
- 10 Ways to Maintain Healthy Joints
- Death and Taxes (and Insurance?)