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Estate Taxes Archives

Make a plan to minimize estate taxes now

One thing that your estate plan needs to consider is the estate taxes that your loved ones will have to deal with. These taxes can be considerable for people who are dealing with high value estates. There isn't any reason why your loved ones should have to deal with this since you can take steps to reduce the amount of estate tax that they will have to deal with.

Estate taxes are based on fair market value not amount paid

When it comes to filing estate taxes, some people are confused about what needs to be done. If your loved one's estate must file a tax return, this must be done within nine months of the death. It is possible to get an extension for another six months.

Elimination of the federal estate tax: The impact it could have

With a new administration in the government, there are always changes. When it comes to estate taxes, changes in the law can impact your plans for the future and your beneficiaries. It's known that President Trump has suggested eliminating the federal estate tax, but does that really affect you?

Who is responsible for paying the federal estate tax?

The federal estate tax is a cut of estate value that goes to the Internal Revenue Service. When the federal estate tax comes into play, it can take a hefty bite out of the value of an estate. Luckily for most people, thresholds on this tax and numerous other factors mean that only a small percentage of people end up dealing with it, and very few estates that include small family business or farms end up on the hook for estate taxes.

You might have to pay inheritance tax but not estate tax

At the end of 2016, New Jersey lawmakers passed a bill that would raise the state estate tax exemption by a hefty amount. The exemption prior to Jan. 2, 2018 is only $675,000. While over half a million dollars sounds like a lot to most families, when you add in the value of homes, retirement investments and other assets, it's easier to hit that total than you might think. In 2014, over 3,000 estate tax returns were filed, for example.

Estate taxes come with plenty of exemptions

As you start to accrue any amount of wealth, you might become concerned about estate taxes. There's a myth out there that the government will take a huge chunk of your estate if you have anything to pass on to your heirs, so it's better to spend it all on yourself and your family now. That's actually not true, due in part to the fact that you can take advantage of numerous estate tax exemptions.

What estate tax benefits do same-sex married couples have?

Because same-sex marriage is recognized by the federal government, same-sex couples now have access to some estate tax benefits that traditional couples have enjoyed for years. These benefits can help reduce the federal tax burden related to both estates and gift-giving.

What is the alternate valuation date?

The alternate valuation date is one of two methods for calculating the value of an estate for the purpose of determining tax liabilities. Usually, the estate is valued based on the how much assets are worth on the fair market on the day the person died, but if the heirs can inherit more by reducing tax burdens, they might be allowed to use the alternate valuation date.

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