Understanding Estate Taxes and Gift Taxes
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
On January 1, 2010, the federal estate tax was officially repealed, but on December 17, 2010, it was reinstated retroactively. Historically the federal exemption from estate taxes and estate tax rate changed and current law provides that the tax will continue to change as shown in the attached "Federal Estate Tax Schedule."
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.
Overview of 2009 Estate Tax, Gift Tax & Generation Skipping Transfer Tax Laws
In 2001, a law was enacted that changed the federal estate tax rules gradually over a ten year period. Here you will find a summary of what the laws provided for the estates of decedents who died in 2009 as well as the gift taxes and generation skipping transfer taxes.
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.
How to Calculate Your Estate Tax Liability
Whether your estate will be liable for estate taxes depends upon 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 get an estimate of your estate tax liability.
Overview of 2011 and 2012 Estate Tax and Gift Tax Laws
On December 17, 2010, a new law was enacted that governs estate taxes for the 2010, 2011 and 2012 tax years. Here you will find a summary of what this new law provides for the estates of decedents who die in 2011 or 2012 as well as the gift tax laws for 2011 and 2012.
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...
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.
Overview of 2011 Estate Tax Filing Requirements
Exemption From Federal Estate Taxes: 1997 - 2013
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 2013.
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.
Overview of 2012 Estate Tax Filing Requirements
In 2010 new laws governing federal estate taxes were introduced that affect the estates of decedents who die in 2010, 2011 and 2012. Learn when a federal estate tax return (IRS Form 706) is required to be filed for deaths that occur in 2012 and all of the applicable filing deadlines.
Do You and Your Spouse Still Have "I Love You" Wills?
Do you and your spouse still have "I Love You" wills? If so, then you are missing out on some incredible estate planning opportunities, including estate tax planning, asset protection planning, and keeping your property in your family instead of allowing it to get into the hands of a second or later spouse's family.
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 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...
What is the Gift Tax?
The federal gift tax is one of the most misunderstood and often ignored taxes assessed by the federal government. One state also assess its own gift tax - Connecticut. Learn what the gift tax is and who is responsible for paying it.
How to Calculate Your Estate Tax Liability in 2011
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 if your...
Overview of 2009 Estate Tax Filing Requirements
In 2009 the federal estate tax exemption increased but the estate tax rate remained the same when compared with prior years. Learn when a federal estate tax return (IRS Form 706) was required to be filed for deaths that occurred in 2009 and all of the applicable filing deadlines.
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.
Lifetime Exemption From Federal Gift Taxes: 1997 - 2013
The exemption from federal gift taxes has increased over the years while the gift tax rate has decreased. Here you will find a chart that shows the changes in the lifetime gift tax exemption and gift tax rate from 1997 through 2013.
Annual Exclusion From Gift Taxes: 1997 - 2013
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 2013.
Exemption From Federal Generation Skipping Transfer Taxes: 1997 - 2013
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 changes in the generation skipping transfer tax exemption and tax rate from 1997 through 2013.
How to Calculate Your Estate Tax Liability in 2012
Whether your estate will be liable for estate taxes depends on a number of factors. Learn how to calculate an estimate of an estate tax bill using the rules that apply to deaths that occur in 2012.
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?
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.
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.
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?