Do I Pay Taxes When Someone Leaves Money from Paul Kraft It can seem as though you are required to report any type of income on your annual income tax return. Learn more about income tax in Indiana in this presentation. … [Read more...] about Do I Pay Taxes When Someone Leaves Money?
Taxes that can come into play when assets are being transferred can be confusing. You have probably heard of the estate tax, and you may assume that an inheritance tax and an estate tax are the same thing. In reality, these are two different forms of taxation. We will look at the distinctions in this post, and we will focus on taxes that can impact Indiana residents. Estate Tax An estate tax would be imposed on the entire taxable portion of the estate in question. Some … [Read more...] about Is There an Inheritance Tax in Indiana?
There are so many taxes out there it is hard to keep track of all of them. Without question, you should understand the taxes that can be applicable when you are planning your estate. One tax that can come into play is the capital gains tax, and we will look at the details in this post. Realizing a Gain When you own assets that have appreciated, the capital gains tax is looming. The gains are taxable, but you do not have to pay the capital gains tax until you realize a … [Read more...] about What Is Capital Gains Tax?
You can transfer unlimited assets to your spouse tax-free, but anything that you want to transfer to others is potentially subject to the death tax. The federal estate tax exclusion is the amount that you can transfer tax-free. The exclusion has changed a great deal over the years. Back in 2009, the federal estate tax exclusion was $3.5 million, and the maximum rate was 45 percent. Due to a provision contained within the Bush era tax cuts, the estate tax was repealed for the 2010 … [Read more...] about Inflation Adjustment Applied to Estate Tax Exclusion
Revocable living trusts are very useful on a number of different levels. However, there is no estate planning device that is an absolute cure-all. With this in mind, let's look at these trusts in detail. Probate Avoidance The biggest benefit that you derive when you create a revocable living trust is the avoidance of the probate process. You probably want your heirs to receive their inheritances in a timely manner. If you use a last will to transfer your personally … [Read more...] about Does a Revocable Living Trust Reduce Income Tax Responsibility?
People who have enjoyed a great deal of financial success are often faced with estate planning challenges. You may naturally assume that you can leave assets to your loved ones free of taxation. After all, you paid many different taxes throughout your life. However, whether it is fair or not, there are taxes on large asset transfers in the United States. Transfer Taxes We have a federal estate tax, and it carries a maximum rate of 40 percent at the present time. The estate … [Read more...] about Are Estate Tax Laws Subject to Change?
When you are planning your estate, you may want to consider your broader legacy. Giving back can be a very powerful thing, especially when you are thinking about how you will be remembered after you pass away. Acts of charitable giving can be rewarding on a personal level, and you can sometimes gain tax benefits when you give to charitable causes. There are various different ways that you can give to organizations and causes that are meaningful to you. Some people create private … [Read more...] about What Is a Charitable Remainder Trust?
People who have been able to accumulate a significant store of wealth should be very aware of federal transfer taxes. In this post we will look at an often overlooked tax called the generation-skipping transfer tax. However, to understand the generation-skipping transfer tax, you need some background information about the the estate tax and the gift tax. Federal Death Tax The federal estate tax carries a 40 percent maximum rate, and this is an attention-getting number. There is … [Read more...] about What Is the Generation-Skipping Transfer Tax?
You may be concerned about taxes when you are planning your estate. What forms of taxation will your loved ones face after you pass away? In this post we will provide answers, and we will ultimately focus on the capital gains tax and the step-up in basis. Income Tax It can seem as though any income that you receive from any source should be reported on your annual income tax return. In fact, this is not the case when it comes to inherited assets. If you receive an … [Read more...] about What Is a Step-Up in Basis?
When you start to plan your estate in earnest, you may wonder if you have to file an estate tax return. You do not have to file an estate tax return unless the taxable value of your estate exceeds the amount of the federal estate tax exclusion. Let's look at the details so that you can proceed in an informed manner. Parameters of Federal Estate Tax Everyone does not have to file an estate tax return because there is a federal estate tax credit or exclusion. This is the line that … [Read more...] about When Is an Estate Tax Return Due?