No. of Recommendations: 5
And I hear you on moving to a tax-free state, but I've seen too many times when a couple does that, one person dies, the other wants to come home to other family members and plan is killed. But great idea if it works --a huge money saver!
For people that are deep enough into the estate tax brackets to matter, usually when the first spouse dies, they don't take the default option and simply allow the money to flow entirely to the surviving spouse. Instead what they do is at the first death, they use the first estate tax exemption to it's fullest extent and have the money distributed, usually via a series of trusts, to assorted family members (and sometimes charities). That way, the full exemption is used (perhaps living in FL at that time), and even if the surviving spouse moves back (or makes other financially unwise decisions), at least a good portion (about half) of the money has already been "protected" (both tax-wise and distribution-wise) to whatever extent possible.
The more typical scenario is when the surviving spouse remarries and eventually whatever money is to be distributed quite often gets distributed in ways that the original spouse didn't quite want. Plenty of nightmare stories like this one.
