Is your estate liquid enough to cover estate taxes?

Description

Abstract: Unless an estate plan provides sufficient liquidity to pay estate taxes and other expenses, it may be at risk. This article examines various liquidity tools, including irrevocable life insurance trusts (ILITs); buy-sell agreements; IRAs, 401(k) plans and other tax-advantaged retirement plans; and traditional investments in stocks, bonds and mutual funds. If those liquidity tools prove inadequate, there are several postmortem strategies that heirs can use to soften the blow of estate taxes.