The United States has taxed the estates of decedents since 1916, and gifts since 1924. With tax rates and exemption levels varying greatly over the last two decades, including recent changes with the Tax Cuts and Jobs Act (TCJA), I thought it would be helpful to outline some key forms and current thresholds relating to estate & gift tax.
So, you were asked to be the Personal Representative (PR) of an estate. It seemed like accepting was the right thing to do at the time. How hard can dividing up your parent’s lifelong savings and assets between siblings really be? Consider the following in deciding to be a PR and navigating the estate administration process.
Taxpayers often utilize gifting as part of their estate plan. However, determining the applicability of the Massachusetts estate tax can lead to some unexpected results when there are lifetime gifts.
You may have heard that lawmakers recently voted to push forward a proposed "Millionaire's Tax" in the state of Massachusetts. Wondering what this means, and when it could possibly impact Massachusetts residents?
To shed some light on the topic, I've put together a list of frequently asked questions and answers:
The IRS recently released an update to its federal estate tax regulations, relaxing the rules on making a late portability election to a descendant's estate.
Currently, the federal estate tax exemption is $5.4 million, meaning that when a person dies, they will only pay federal estate tax (up to 40%) if the value of their estate exceeds $5.4 million. In 2011, the IRS introduced a concept called 'portability' to the federal estate tax exemption, and has now added an additional rule to allow for a late portability election. Here's what you should know:
Did you know that if your estate is large enough, up to 40% of your life insurance death benefits can be lost to federal estate tax?
Although life insurance proceeds are not subject to income tax, they are included in your taxable estate, and therefore can be subject to estate tax. To prevent the taxation of life insurance proceeds, many of our clients choose to purchase their life insurance policy using an Irrevocable Life Insurance Trust (ILIT), or gift their existing policy to an ILIT.
