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Posts tagged "Estate Tax"

Estate tax implications for small businesses

Your entrepreneurial pursuits in Miami have hopefully yielded a significant windfall for you and your family, and provided people in the local community with jobs. Yet what happens to your business after you are gone? If you have earned significant personal assets, your estate could be subject to the federal estate tax. Many small business owners in your same position come to us here at The Law Offices of Frye and Vazquez, P.L. concerned that their having to pay the estate tax will force the sale of their companies. Should you be sharing this same concern?

What is an IRS Form 706?

If you have been named as the executor of the estate of a friend or family member in Miami, then one of the first things that you should consider are the tax considerations of the assets you are now in charge of. This requires becoming familiar with the IRS Form 706. What is this form? It is the one used to submit an estate tax return. Copies of this form can be downloaded directly from the Internal Revenue Service’s website. Make sure, however, that you are using the current year’s form, as these documents are often updated annually.

Determining your taxable estate

Many people often come to us here at The Law Offices of Frye and Vazquez, P.L. concerned that much of what they have to leave to their spouses, children, and/or grandchildren will be taken through estate taxes. If you share this same concern, you should know one thing: most estates in the U.S. will not be subject to an estate tax. That is because their total values do not exceed the estate tax threshold set by the federal government. Whether or not yours will depends on the value of your taxable estate.

Filing an estate tax return extension

As the executor for the estate of a family member or friend in Miami, the one area that may cause you the most trepidation is dealing with the having to pay estate taxes. Those who come to us here at The Law Offices of Frye and Vazquez, P.L. with their tax questions typically want to know two things: First, if their loved one’s estate is even required to pay taxes. If it is, then they typically want to know how long they have to pay them. If a looming estate tax return filing deadline is approaching, you may want to consider asking for an extension in order to have the time needed to collect information to do an accurate tax assessment.

Avoiding estate taxes after a life insurance payout

Many in Miami may be counseled on the wisdom of taking out a life insurance policy to help ease the financial burden their loved ones may feel when they die. One of the more attractive aspects of a life insurance policy are the perceived tax advantages it offers, specifically that beneficiaries do not have pay income tax in its proceeds. Yet while that is true, many do not consider that a life insurance payout may suddenly force their loved ones to become subject to estate taxes.

What is your estate tax obligation in Florida?

As you become involved in estate planning in Miami, you may begin to see more and more references being made to estate taxes. Most often, this is in reference to the federal estate tax, which you only pay if the taxable value of your estate exceeds the federal threshold (currently $5.49 million per Forbes Magazine). Yet were you aware that individual states can also levy their own estate tax?

Paying the estate tax

Many in Miami who are parties to the estates of their loved ones come to us here at The Law Offices of Frye and Vazquez, P.L. concerned about having to pay an estate tax. Most are relieved to hear that few are actually required to pay this tax, as most estates do not meet the tax threshold imposed by the Internal Revenue Service. However, if you are asked to be the executor of an estate, you should understand the process of how this tax should be paid, as the possibility of you having to deal with it is ever present.

Understanding the marital deduction

Many in Miami may never have to worry about the issues of estate taxes. That is because the law allows an individual an estate tax exemption equivalent. Often referred to as the estate tax threshold, this figure represents the amount that one may leave to the beneficiaries without being subject to the federal estate tax. According to Forbes Magazine, that number is $5.45 million for 2016. Spouses may also combine the values of their estates to protect as much as $10.9 million from tax.

Protecting beneficiaries from the dangers of sudden wealth

People often dream of winning the lottery, inventing the next million-dollar idea and stumbling into fame and fortune on reality TV competitions. But the truth is people don't have to do any of these things to have sudden wealth fall into their laps; they just need a wealthy relative.

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