You've worked all your life to build what you have. You spent years in school, internships and working your way up the corporate ladder to get where you are today. Don't let all of it come crashing down after you are gone by facing high taxes on your estate. Today, we will take a look at some tax tips for large estates so your family members are not hit with massive taxes upon your death.
Common questions about estate taxes
For many estate planners, the question of taxes can feel complex and overwhelming. It is important that you do not bury your head in the sand when it comes to tax filings. By taking some small steps to address the most lingering questions, it is likely that you will find the estate planning process much easier to handle.
Estate tax exemptions in Massachusetts
If you are starting to plan your estate, it is likely that you will want to look into the taxes that may or not be applied to your estate at the end of your life. Many people make it their primary goal when planning their estate to minimize the gift and estate taxes that they will need to pay. This can be effectively done by being creative with your estate plan.
An overview of estate taxes in Massachusetts
When a loved one passes away, it is likely that you will need to go through the probate process, which includes paying any taxes owed in regard to the estate. The current Massachusetts estate law is applicable to estates owned by decadents who passed away in 2006 or later. When the value of an estate is $1,000,000 or lower, this amount is excluded from being taxable. For example, when an estate in Massachusetts is worth $1,100,000, only $100,000 of the estate will be taxable.
The reasons why people choose to estate plan
If you have not started to plan your estate, you are putting yourself in a hole. This very well could be a hole that you never crawl out of, depending on your age or health. It is recommended that you start to plan your estate the minute you are hired for your first full-time job after school. Even if you aren't married. Even if you don't have children. It's still important to write down where you want your property to go upon your death.
Smart ways to protect your wealth
No one wants to lose their hard-earned cash to foolish investment strategies. Therefore, it pays to invest a little time into knowing how to adequately manage your wealth in the future, both for your life and the lives of your beneficiaries.
How is an estate calculated after death?
It can be confusing to try to navigate the estate valuation process. Whether you are someone who is currently planning their estate and you want to understand the entire process, or if you are a person that has recently lost a loved one, it is important to conduct adequate research so that you know how different assets are calculated.
How to avoid unintentional tax evasion
Everybody wants to arrange their taxes so that they are advantageous and maximize their income as much as possible. While this is a natural and smart thing to do, many people accidentally cross the line and engage in practices that the Internal Revenue Service (IRS) considers tax evasion or fraud.
Navigating federal estate taxes
Only a small minority of people are affected by federal estate tax. In fact, between December 2012 and March 2016, only .2 percent of Americans needed to pay federal taxes on their estate. However, state taxes are still applicable to many Americans today.
Deep tax cuts proposed could affect estate planning
The current leaders of the House of Representatives are proposing some major tax cuts that could, if passed, affect both corporate and individual taxes.
