Before beginning to learn about estate planning, one must first understand the difference between state law, which concerns Probate, and federal law, which deals with Inheritance Tax.

Under state law, probate is required for an estate where the gross value (as opposed to the net value) of the estate exceeds $20,000 in real property or $100,000 in titled personal property (i.e., stocks, bonds, mutual funds, bank accounts, etc.).

Under federal law, the beneficiaries of your estate (usually your children), must pay Inheritance Taxes (a.k.a. Estate Taxes) where the net value of your estate exceeds $1,000,000.