Where you die matters. While you’ll pay the same federal estate tax no matter where you die, 1/3 of the states have a separate estate or inheritance tax. The most populous state, California, is the latest state to consider adding a state estate tax. Read on to learn more. When and Where You Die Matters … [Read more...] about When and Where You Die Matters
If you currently have an estate plan, you should visit an attorney to have it updated this year. The laws concerning the gift tax and the estate tax are currently scheduled to change at the end of this year. You need to make sure that your estate plan is up to date and conforms with any new laws. If you don't, then your family might not receive all of the inheritance that you thought you were leaving them. Estate planning attorneys have many different ways to lessen the gift tax and estate tax … [Read more...] about Updating Your Estate Plan in 2012
Not every gift has to be reported to the IRS, nor does every gift trigger a tax; but it’s important to understand when the IRS needs to know about a gift. Here’s a brief summary of the situations in which the federal gift tax applies: Who Receives the Gift, and How Much is it Worth? For gift tax purposes, the IRS looks at gifts to a spouse differently than it does gifts to a non-spouse. Assuming your husband or wife is a United States citizen, the unlimited marital deduction applies, and you … [Read more...] about When is a Gift Taxable?
There are many everyday situations in which we give gifts that aren’t subject to the federal gift tax. On the other hand, there are quite a few situations where gifts are reportable to the IRS, and they may be taxable. It’s important to know the difference. So, what types of gifts are not subject to the gift tax? Gifts to a U.S. Citizen Spouse If your husband or wife is a United States citizen, then you can give him or her an unlimited amount of property, tax-free, regardless of value. If your … [Read more...] about The Gift Tax Doesn’t Always Apply
A lot of estate planning advice focuses on the steps you can take to protect and provide for your spouse and children, while minimizing your tax burden. But what about taking care of your mom and dad? Many adult children are in a better financial position than their elderly parents, and want to know what they can do to share the fruits of their labor. Here are just a few suggestions: Give Gifts: Under the current federal gift tax law, you can give up to $13,000 in money or property to an … [Read more...] about Sharing the Wealth With Mom and Dad
Congress has passed the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 ,and on December 17, President Obama signed it into law. Among the many things the new law does is give us temporary certainty as to the status of the federal estate and gift taxes. Here’s a brief rundown: As for the estate tax, the maximum rate is 35%, and there’s a $5 million individual exemption. Any exemption that is unused by the estate of one deceased spouse may be used by the … [Read more...] about It’s Official: The Return of the Estate Tax
Back in December, the law that’s become known as the Tax Relief Act of 2010 (TRA 2010) was signed. In addition to a new estate tax threshold, not to mention quite a list of other provisions, TRA 2010 made changes to the federal gift tax law. Here’s a quick look: There are still two types of exemptions when it comes to the tax: the annual gift tax exemption, and the lifetime exclusion. They work together in determining whether you have to report gifts you’ve made during a particular year, as … [Read more...] about The New Gift Tax Law
With so much focus on the estate tax, the federal gift tax is often an overlooked topic of conversation. Here’s how it works: Annual Exclusion You’re allowed to make gifts of up to $13,000 per year, per recipient who is not your spouse. If you’re married and your spouse is a U.S. citizen, then there’s no limit to the value of gifts you can give him or her. (If you spouse is not a U.S. citizen, then you’re somewhat more limited.) Each grantor has the right to give gifts, tax-free, up to … [Read more...] about What is the Gift Tax?