There are ways around the estate tax. That's what high $$$ tax lawyers and estate planners are for. The trouble is finding one who knows what he's doing -- well, it's a collective effort, really, and they do charge fees it. Big time. Pay the IRS or pay the lawyers. Although, hopefully you will pay the lawyers less than the IRS.

I know several cases where it wasn't done right and the heirs ended up paying a lot more than they were assured. I also know of some cases where a big automotive manufacturer built a big plant, and had to move out a lot of long time residents from the area they were going to build the plant. Slick lawyers, working for the state and the manufacturer mostly made all sorts of promises about "rolling over" the proceeds of the sales of land and homes.

They assured a lot of those people they wouldn't have hardly any income tax to pay, but they did. Big Time. Had some of the people understood how much taxes they were going to have to pay, they might've resisted more. The state would've prevailed in the end no matter what, but it could've been a lot more trouble. And that's one of the reasons why at this point, I hardly trust anyone anymore when it comes to money matters.

The very wealthy can afford the lawyers to stay on top of all the minutia of the ever changing tax code. The middle class usually doesn't, and they are the one that get hit with it.

I have personal experience with estate planning lately, and it can get involved. Again, it's imperivative you get those you know what they are doing.

-Richard

The estate pays the estate tax not the receiver but obviously the estate can not give to you what it no longer has since it went to the government. So the receiver does sort of pay.

Very few people have to pay estate tax. If you have an estate large enough to worry about estate tax you can use the annual exclusion in give tax to transfer money while you are still alive tax free. And transfers between husband and wife are always tax free.

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