[WildHighlander57]

Question:

Do the taxes still apply if the assets are held in a trust?

Assets in a trust dont go though probate; not considered part of the estate.

[SubMareener]

That is wrong. When the grantor of a trust dies, the trust is subject to estate taxes on his or her share of the trust. If the trust is set up properly, when one grantor dies, the assets of the original trust are divided equally into two trusts, A and B. Trust A is the trust of the deceased grantor. It is subject to estate tax on its value. The B trust goes to the surviving grantor. Usually the survivor can draw on the A trust for living expenses, etc, but that is not a really good idea. When the second grantor dies, the B trust is subject to estate taxes. Then the two trust are merged into an administrative trust before being divided among the remaining beneficiaries. So there is no getting around the estate tax. However, if the survivor lives off their B trust and grows the A trust they can maximize the amount passed on to the beneficiaries, because the A trust is only subject to the estate tax once.

[juma]

Wrong, a Trust only protects you from having the state probate your estate and keeps it from public view. It saves you the 15% probate fee the court will access if you die intestate. Other than that, you are still subject to state and federal laws concerning taxation of estate. Depending on the trust, it can help you when you are still alive and in some situations make you law suit proof. A trust is a good thing if you have assetts, but not if you don’t