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Understanding Estate Taxes and Gift Taxes

Learn about the taxes that affect every estate, including gift taxes, estate taxes, generation skipping transfer taxes and income taxes; how to minimize or even eliminate estate taxes if your estate is taxable; your options for paying estate taxes; and how to effectively use life insurance to minimize and/or pay for estate taxes.
  1. Estate Taxes (72)
  2. Gift Taxes (15)
  3. Tax Charts (11)
  4. Understanding State Estate Taxes and Inheritance Taxes (153)

Understanding Estate Taxes & Advanced Planning
Understanding estate taxes, inheritance taxes and gift taxes is essential to planning an estate. And once the basic estate plan is in place, the next step is to assess the need for asset protection planning and other types of advanced planning.

Understanding Death, Estate, and Inheritance Taxes
There are two types of taxes that can be assessed against your property after you die - estate taxes and inheritance taxes, both of which are commonly referred to as death taxes.

Overview of Taxes that Affect an Estate
When preparing or updating your estate plan, you will need to have a basic understanding of the different types of taxes that can affect your estate - gift taxes, estate taxes, inheritance taxes, generation skipping (or GST) taxes, and income taxes.

What is the Federal Estate Tax?
Some form of federal estate tax has been around since 1916. Learn what the estate tax is, who is subject to it, and when an estate must file a federal estate tax return.

Overview of Current Federal Estate Tax Laws
In early 2010 the federal estate tax was officially repealed, but at the end of 2010 it was reinstated retroactively. Here you will find a summary of the current federal estate tax laws.

When is a Federal Estate Tax Return Required to Be Filed?
A federal estate tax return, or IRS Form 706, is only required to be filed under very specific circumstances. Regardless, some estates may need to prepare IRS Form 706 strictly for state estate tax purposes or electing portability, while others should consider filing IRS Form 706 even if it is not required to be filed.

When is a Federal Estate Tax Return Required to Be Filed for Deaths in 2013?
A federal estate tax return (IRS Form 706) is only required to be filed under very specific circumstances. Regardless, some estates may need to prepare IRS Form 706 strictly for state estate tax purposes or electing portability, while others should consider filing IRS Form 706 even if it is not required to be filed. Here you will learn when an estate tax return needs to be filed for deaths that occur in 2013.

When is a Federal Estate Tax Return Required to Be Filed for Deaths in 2014?
A federal estate tax return (IRS Form 706) is only required to be filed under very specific circumstances. Regardless, some estates may need to prepare IRS Form 706 strictly for state estate tax purposes or electing portability, while others should consider filing IRS Form 706 even if it is not required to be filed. Here you will learn when an estate tax return needs to be filed for deaths that occur in 2014.

How to Calculate the Value of Your Gross Estate
If you want to calculate your estate tax liability, you'll first need to calculate the value of your gross estate. Here's how.

What Value of an Asset is Used for Estate Tax Purposes?
When calculating the value of a gross estate for federal estate tax purposes, there are two different values that can be used: the "date of death" value and the "alternate valuation date" value.

How to Calculate Your Estate Tax Liability
Whether your estate will be liable for estate taxes depends on the value of your gross estate, the amount of debt owed by you at the time of your death, the total expenses that will be incurred while settling your estate, and any deductions that your estate can take. Here's how to figure out an estimate of your estate tax liability.

How Long Does it Take to Receive an Estate Tax Closing Letter from the IRS?
When an estate is required to file a federal estate tax return, the heirs are often surprised to learn that the estate cannot be completely distributed until a "closing letter" is received from the IRS. Here you will find a timeline for how long it take to receive the coveted IRS estate tax closing letter.

What is the Modified Carryover Basis Regime?
For deaths occurring in 2010, the decedent's heirs will have the choice of applying the federal estate tax or making use of the "modified carryover basis regime." This means that the heirs will need to choose between receiving an unlimited "step up" or a limited step up in the basis of the inherited property. So what is the modified carryover basis regime?

What is Portability of the Estate Tax Exemption?
The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 made changes to the federal estate tax rules, including introducing the concept of "portability" of the federal estate tax exemption. The American Taxpayer Relief Act of 2012 has made portability permanent. So what does "portability" of the estate tax...

Exemption From Federal Estate Taxes: 1916 - 1997
The federal estate tax has been around in some shape or form since 1916. Here you will find a chart that shows historical estate tax exemptions and rates from 1916 through 1997.

Exemption From Federal Estate Taxes: 1997 - 2014
The exemption from federal estate taxes has gradually increased over the years while the estate tax rate has gradually decreased. Here you will find a chart that shows the increases in the exemption and decreases in the tax rate from 1997 through 2014.

New Estate Tax and Income Tax Laws for 2013
To avoid the so-called fiscal cliff, Congress and President Obama acted in the early hours of 2013 to pass the American Taxpayer Relief Act. Find out what this new law means for estate taxes, gift taxes, generation skipping transfer taxes and income taxes for 2013 and beyond.

How to Minimize Estate Taxes
While the federal estate tax was originally repealed in 2010, it came back retroactively and remains in effect today. Many states also assess estate taxes and/or inheritance taxes. For people whose estates will be taxable at the state and/or federal level, they have several options for reducing their estate tax bill.

Should the Federal Estate Tax Be Repealed?
Some form of a federal "death tax" has been in existence since 1916. In 2001 the Bush administration enacted a law which led to complete repeal of the federal estate tax in 2010, but now the tax is back. What do you think, should the tax be repealed once and for all?

What is the Future of the Federal Estate Tax - 2012 and Prior Years?
This article discusses the possible estate tax changes that Congress and President Obama could have made in 2012 and prior years.

What is the Future of the Federal Estate Tax in 2014 and Beyond?
The passage of the American Taxpayer Relief Act of 2012 has added some certainty to the future of federal estate taxes, or at least many believe this to be the case. Nonetheless, with the federal deficit soaring to record numbers, the need for increasing revenues will continue for years into the future. So what really is the future of federal estate taxes in 2014 and beyond?

Do You and Your Spouse Still Have "I Love You" Wills?
Do you and your spouse still have simple "I Love You" wills? If so, then you are missing out on some incredible estate planning opportunities. Learn how an estate plan that includes AB Trust or ABC Trust planning can benefit your family.

What is the Gift Tax and Who Pays It?
The federal gift tax is one of the most misunderstood and often ignored taxes assessed by the federal government. Two states also assess gift taxes. Learn what the gift tax is and who is responsible for paying it.

What Gifts Are Subject to the Gift Tax?
The federal gift tax applies to all gifts that you make during the course of your lifetime. Whether a gift will be taxable for gift tax purposes depends on three things. Find out what they are and if you have made any taxable gifts.

What Gifts Are Not Subject to the Gift Tax?
Not all transfers of property from one person to a nonspouse beneficiary where no cash or other monetary value is exchanged are taxable for federal gift tax purposes. Currently there are three types of such transfers that are not actually considered gifts at all for federal gift tax purposes. Learn about them here.

When is a Gift Tax Return Required to Be Filed?
One of the most misunderstood taxes is by far the federal gift tax. Learn what the federal gift tax is and if you will need to file a federal gift tax return, or IRS Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, with regard to gifts that were made in 2009, 2010, 2011 or 2012.

When is a Gift Tax Return Required to Be Filed for Gifts Made in 2013?
One of the most misunderstood taxes is by far the federal gift tax. Learn what the federal gift tax is and if you will need to file a federal gift tax return, or IRS Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, with regard to gifts that are made in 2013.

When is a Gift Tax Return Required to Be Filed for Gifts Made in 2014?
One of the most misunderstood taxes is by far the federal gift tax. Learn what the federal gift tax is and if you will need to file a federal gift tax return, or IRS Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, with regard to gifts that are made in 2014.

Lifetime Exemption From Federal Gift Taxes: 1997 - 2014
Find out what the lifetime exemption from gift taxes is and how it has changed from 1997 to the present.

What is an Annual Exclusion Gift?
At the end of each year I get calls from clients who are ready to make their year end "estate planning" (as opposed to holiday) gifts to their loved ones. Learn about annual exclusion estate planning gifts here.

Annual Exclusion From Gift Taxes: 1997 - 2014
The annual amount exempt from the federal gift tax, called the annual gift tax exclusion, was indexed for inflation beginning in 1997 and has slowly increased over the years. Here you will find a chart that shows the increase in the annual gift tax exclusion from 1997 through 2014.

Exemption From Federal Generation Skipping Transfer Taxes: 1997 - 2014
The exemption from federal generation skipping transfer taxes has increased over the years while the tax rate has decreased. Here you will find a chart that shows the increases in the exemption and decreases in the tax rate from 1997 through 2014.

How Much Life Insurance Do You Need?
If you don’t have enough life insurance, you could put your family in a difficult situation after your death, but having too much could mean you're throwing money out the window. So, how much life insurance do you need?

Needs and Uses of Life Insurance in Estate Planning
Life insurance can play an important role in estate planning in two very distinct ways.

Do You Have to Report Gifts or Inheritances Received from Foreigners to the IRS?
If you are a U.S. citizen or resident alien and you receive any gifts or bequests from nonresident aliens, then you may have to report the gifts or bequest to the IRS. Learn about the filing requirements for IRS Form 3520 here.

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