Just before the holidays, Congress passed the new law pertaining to estate planning and estate taxes for 2011. So what does the law hold for this year? On January 1, 2011, the federal estate tax returned. Estates valued at $5 million or less are exempt from the estate tax. Estates valued at more than $5 million are subject to a 35% estate tax rate. While this may seem generous on the federal level, don’t forget that nearly half of the states impose their own estate or inheritance tax, … [Read more...] about 2011 Estate Taxes – What the New Law Means to You
Taxes
Estate Planning and the Holidays
Tis the season for estate planning. While it would seem that the holidays would not be the ideal time to discuss an estate plan and estate taxes, it is the end of the year and there is time to consider a gift that can further your estate plan. In 2010, due to the lapse in the federal estate tax provisions, you are permitted to gift up to $13,000 to any one person without paying gift taxes and without impacting your $1 million lifetime gift exemption. Gifts of over $13,000 will be taxed at the … [Read more...] about Estate Planning and the Holidays
Avoid Capital Gains Tax With a Charitable Trust
Capital gains tax. Those words can strike dread in the heart of any investor. But what if you could enjoy the fruits of your savvy investing without paying the taxes and help out a charitable organization at the same time? Charities aren’t subject to capital gains taxes, and any proceeds from a sale of property stay in the trust and benefit you. When you turn over ownership of a non-income producing asset to a charity through a charitable trust, the charity will sell the asset and buy something … [Read more...] about Avoid Capital Gains Tax With a Charitable Trust
Three Deductions for Federal Estate Taxes
Estate planning is not only planning the distribution of your property when you pass away, but planning to make the most of deductions and exemptions for estate taxes. We discuss three deductions that reduce federal estate taxes. 1. Unlimited Marital Deduction The unlimited marital deduction allows a spouse to pass unlimited property to the surviving spouse with no limit to the value of the property. There is a drawback to using this as the sole method of reducing estate taxes, as it could … [Read more...] about Three Deductions for Federal Estate Taxes
Estate Tax Terms You Should Know
With the federal estate tax playing a major role in estate planning, it is important to understand estate taxes and the terms that are used in this area. As you probably know, the IRS seems to have a language all their own, so we will define the most commonly used terms in estate taxes as it pertains to creating an estate plan. Capital Gain: The profit from the sale of property such as stocks, bonds and real estate. Cost Basis: The original price of an asset, such as stocks, bonds, property … [Read more...] about Estate Tax Terms You Should Know
Estate Planning for Estate Taxes
With the turmoil caused by the repeal of the Federal estate tax in 2010, and the return of the tax in 2011, now is the time to address paying estate taxes within your estate plan. Currently, on January 1, 2011, the Federal estate tax is set to return with a vengeance, as the Federal threshold is slated to be just $1 million with a tax rate up to 55%. With the value of a home, along with stocks, bonds and retirement accounts included within an estate, the $1 million threshold may be closer than … [Read more...] about Estate Planning for Estate Taxes
Marital Deductions and Estate Taxes
Unlimited marital deductions are an important aspect of estate planning, as they allow property to pass to spouses without estate taxes. But we need to take a look at the impact on future estate taxes. If property passes outright to a spouse, whether it is passed through a will, trust, or joint ownership, it normally qualifies for the unlimited marital deduction. However, it will be included in the taxable estate of your spouse unless the surviving spouse spends or gifts it during their … [Read more...] about Marital Deductions and Estate Taxes
Update on Estate Taxes
There’s been quite a bit of speculation about what Congress plans to do with the estate tax. Under President George Bush’s 10-year tax-cut program, the estate tax has slowly dwindled over the last nine years. And this year, there’s no estate tax at all. But if Congress doesn’t do something between now and January 1st, the estate tax will return with the same $1 million exemption it had prior to 2001. In a recent attempt to remedy this problem, Senator Jim DeMint proposed a permanent repeal, … [Read more...] about Update on Estate Taxes
