Under current law, the estate tax takes a 40% cut from a taxable estate
when a person passes away.
When Jane dies several years later, having fully utilized her exemption for lifetime gifting, the S4 million taxable estate
she leaves to her daughter Kim (Sally's grandchild) at her death is also subject to estate tax--thereby subjecting the $4 million to estate tax twice, once at each generation below Sally.
By reducing taxable estate
assets, families can protect and pass on more to future generations
In addition, the death of general partner results in the reduction of your taxable estate
because it will include only the value of your general partnership interest, not the value of the FLP's underlying assets.
A's estate had not made a proper portability election on a timely filed estate tax return), A's unused estate tax exclusion would have been lost, and B would have a taxable estate
of $4,660,000 ($10 million-$5,340,000) and federal estate tax of $1,864,000 at the current 40% rate.
Among those could be guaranteed cash flow, removing liquid assets from a taxable estate
, creating an economic cash flow for a charitable trust or avoiding a double taxation from estate and IRD (Income in Respect of a Decedent) taxes on qualified retirement plan monies.
However, the gift reduces the taxable estate
of the giver.
His practice concentration areas are appeals, civil litigation, local government law, basic estate planning, taxable estate
planning and taxable estate
& trust administration.
and estate tax liability, which are unavailable to other estates.
However, he noted, that because farm assets and business assets represent a relatively small share of total taxable estate
value, "repeal or modification of the estate tax would benefit more estates with a variety of different asset types.
The value of these annual exclusion gifts plus all future annuity growth is totally removed from the taxable estate
for estate tax purposes.
We'll also explore the role that variable annuities can play, whether clients are looking to accumulate more money, reduce the size of their taxable estate
or control the income and/or deferred asset growth inside a credit shelter or charitable remainder trust.