Florida residents who are the recipient of an estate will likely have to deal with some form of estate tax, whether it's a death tax or an inheritance tax. But are there ways that you can reduce said taxes? We at the Law Offices of Frye & Vasquez, P.L., will walk you through your options.
There are, in fact, legal ways that you can reduce estate taxes. A couple of them involve transferring assets as gifts. One type of transfer is known as a uniform transfer to minors, in which the gift is given to whoever is the child's custodian. They will then use it on the child's behalf until the child is of legal age and able to take over the assets for themselves.
Another type is known as a lifetime gift to children and grandchildren. Annual gifts of up to $12,000 can be given to your children and/or grandchildren without incurring any taxes. This is limited by person rather than by household, meaning multiple people in one house can be receiving $12,000 in untaxed gifts.
Marital transfers allow you to avoid taxes as well. Only spouses who are noncitizens will be taxed. Estate taxes must still be paid by the spouse on the taxable estate, however, meaning the taxes are simply deferred rather than eliminated.
Family limited partnerships are available if you have a business in the family and intend to pass it on to the next generation. This allows the partnership to be taxed at the children's lower rates. There are other options for reducing estate tax as well, which you can view on the web page linked here.