One of the primary goals of proper estate planning is to maximize the size of the estate while minimizing the impact of taxes. In that vein, many readers of this blog may be interested to know that Ohio's General Assembly recently voted to repeal the state's estate tax. However, even with the upcoming repeal of the state estate tax, comprehensive estate planning is still necessary due to federal taxes and the complexity of other issues involved.

Ohio's current estate tax will still be on the books until Jan. 1, 2013. This means that the estates of those who pass away in 2012 will still have estate taxes to pay to the state. At the moment, only estates that are worth less than $338,333 are not taxed. All estates valued between $338,333 and $500,000 may be taxed 6 percent of any amount more than $338,333 plus $13,900. For those estates worth more than $500,000, they may be taxed $23,600 as well as up to 7 percent of the total that exceeds $500,000. However, after Jan. 1, 2013, no one will have to pay any state estate tax.

Yet, that does not rule out federal estate taxes or the costs of probate. In order to avoid these problems, it is often worthwhile even for young and healthy Ohio residents to consider estate planning. Not only can it help guide investment decisions, but it may also prove to be of tremendous benefit to one's family in the event of a tragedy.

The laws and regulations governing estate planning are complicated. But like most things in life, proper planning and informed action can help alleviate a host of potential problems in probate and estate issues. Through the development of a well-thought-out estate plan, it may be possible to maximize the benefit of the estate for one's heirs.

Source: Mount Vernon News, "Inheritance tax shrinking," Bill Amick, Jan. 17, 2012