12Law Arrow 12Law Arrow  Easy Questions  
12Law Arrow 12Law Arrow Instant Legal Documents
 
 
FINANCIAL & MARITAL

Cohabitation Agreement coming soon!
Separation Agreement coming soon!
No-Fault Divorce coming soon!
Bankruptcy coming soon!
 
 

A Primer on Estate & Inheritance Taxes in Farmersburg, IN

A Primer on Estate & Inheritance Taxes in Farmersburg, IN


Me and my dad are the biggest promoters of an estate tax in the US. It's not a popular position.
 
- Bill Gates


When you die, you leave your home, your possessions, your money, and other things of monetary value to spouses, children, family members, friends, charity or religious institutions. The government wants its share. Some argue that estate taxes can provide for future generations. Others argue that is robs inter-generational businesses of the capital they need to keep growing.

Your estate may be subject to inheritance tax, estate tax, state and federal tax statutes, and a host of exemptions that can pass more of the estate to inheritors of your choosing.

What are the differences between Estate Taxes and Inheritance Taxes?

Let's start with estate tax. Your estate is the total of your possessions and debts left behind when you die. An executor, either named in the will or appointed by law, will pay off outstanding debts, cover funeral expenses, and administrative costs (e.g. executor's fees). If necessary, executors may liquidate property to pay taxes, debts, or fees. After federal and state estate taxes are paid, the remainder goes to the heirs. So, the estate tax is a tax on the total amount of the estate, after creditors are paid but before any heirs get their bequest. The tax is paid by the estate itself.

Inheritance tax occurs after the heirs receive their payouts. It is a tax on the amount received and is paid by the heir. Inheritance taxes are levied by the states. This means that in many cases an estate is taxed twice -- first by the federal estate tax, then by the state inheritance tax.

The estate includes cash on hand, bank accounts, financial assets (stocks, bond, mutual funds, etc.), real estate, automobiles, boats, art pieces or rare collections, personal property, debts owed to the estate, business interests, etc. An estate is made up of all of these things. An appraiser will determine the fair market value of everything to determine the taxable value of the estate.

Inheritance Tax Exemptions

For large estates, sophisticated estate planners will work with the family and utilize trusts, charitable donations, non-taxable gifts and other techniques to meet the family's needs and minimize the tax burden.

For small estates, there are exemptions are applied to the taxable amount before estate taxes are collected. Exemptions can be relation based and amount-based.


There is an exemption when the estate is passed from a deceased person to their US citizen spouse. It will not be subject to any federal estate tax. States that levy an estate tax generally follow the federal government's rules for this, as well. If the estate is passed to children, siblings or golfing buddies, the exemption doesn't apply.

Amount-based exemptions are $5.34 million for an individual, $10.68 million for a couple as of 2014. It is indexed for inflation, so it will probably grow over time.

State inheritance taxes vary a great deal and can make things much more complicated. There might be exemptions for some family members, or different tax rates depending on whether you are a spouse, a child or just a friend. Many states tie their inheritance tax directly to the federal estate tax and exemption rate. Some have much lower thresholds than the federal threshold.

There are a few other miscellaneous deductions, such as a mortgage, usually deducted from the estate's value before taxation. Family businesses and farms may be taxed at a lower rate. Inheritance taxes tend to be set up on a progressive scale, meaning as the value of the estate increases, the tax rate rises and the taxes increase exponentially.

 
Personalize & Print a Free IN Last Will Create This Document
Page 1
Page 2
Page 3
Page 4
Page 5
Page 6
Page 7
Page 8
Page 9
Page 10
 
Personalize & Print a Free IN Power of Attorney Create This Document
Page 1
Page 2
Page 3
Page 4
Page 5
Related Legal Services near Farmersburg, IN
Skees Law Office
415 W 1st St
New Albany, IN 47150
(812) 944-9990
General Practice Attorneys, Attorneys
MacGregor Charles E
1805 Old Vincennes Rd
New Albany, IN 47150
(812) 944-9970
Attorneys, Legal Service Plans
Ambers David
105 J St
La Porte, IN 46350
(219) 325-9917
Attorneys,  Accident & Property Damage Attorneys,  Real Estate Attorneys,  Construction Law Attorney
O'Bryan Law Offices
515 Pearl St
New Albany, IN 47150
(812) 944-9709
Bankruptcy Law Attorneys, Business Bankruptcy Law Attorneys, Attorneys
Gordon & Associates
2859 Northpark Ave
Huntington, IN 46750
(260) 359-9681
Elder Law Attorneys, Attorneys
Howes & Howes LLP
717 Indiana Ave
La Porte, IN 46350
(219) 595-9653
Criminal Law Attorneys, Family Law Attorneys, Lawn & Garden Equipment & Supplies, Lawn Maintenance,
Mikula & Stephan PC
401 State St
La Porte, IN 46350
(219) 362-9624
Wills, Trusts & Estate Planning Attorneys,  Attorneys,  Legal Service Plans,  Bankruptcy Law Attorn
James Robert G
6602 E 75th St
Indianapolis, IN 46250
(317) 537-9579
Insurance Attorneys,  Attorneys,  Personal Injury Law Attorneys,  Business Law Attorneys,  Real Esta
O'bryan, Julie - O'bryan Law Offices
515 Pearl St
New Albany, IN 47150
(812) 944-9510
Bankruptcy Law Attorneys, Attorneys, Bankruptcy Services
Bierly Richard A Atty
1040 Chapel Creek Trl
New Albany, IN 47150
(812) 948-9247
Attorneys, Legal Service Plans
Mc Cullum Jerry
1811 State St
New Albany, IN 47150
(812) 945-9225
Attorneys,  Accident & Property Damage Attorneys,  General Practice Attorneys,  Legal Service Plans
Lohmeyer Law Office
430 W 1st St
New Albany, IN 47150
(812) 948-9211
Child Custody Attorneys,  Attorneys,  Wills, Trusts & Estate Planning Attorneys,  Business Bankrupt
Kruger & Schwartz
810 E Market St
New Albany, IN 47150
(812) 945-9200
Attorneys,  Bankruptcy Services,  Bankruptcy Law Attorneys,  Business Bankruptcy Law Attorneys,  Leg
Richard A. Schwartz Attorney
810 E Market St
New Albany, IN 47150
(812) 945-9200
Bankruptcy Law Attorneys,  Attorneys,  Bankruptcy Services,  Legal Service Plans
Forrest Donald R
223 E Spring St
New Albany, IN 47150
(812) 945-9151
Attorneys,  Malpractice Law Attorneys,  Accident & Property Damage Attorneys,  Legal Service Plans,
Prime & Flores Law Office
112 E 3rd St # 200
Madison, IN 47250
(812) 265-9020
Insurance Attorneys,  Attorneys,  Criminal Law Attorneys,  Personal Injury Law Attorneys,  Legal Ser
Rise N Roll Nappanee
70509 State Road 19
Nappanee, IN 46550
(574) 773-9012
Bankruptcy Law Attorneys
Stallwood Robert K
6435 Castleway West Dr
Indianapolis, IN 46250
(317) 585-8900
Attorneys, Wills, Trusts & Estate Planning Attorneys, General Practice Attorneys, Legal Service Plan
Foley Edmond W
809 Jefferson Ave
La Porte, IN 46350
(219) 326-8888
Accident & Property Damage Attorneys,  Attorneys,  General Practice Attorneys,  Legal Service Plans,
Powell Law Offices
7202 N Shadeland Ave Ste 118
Indianapolis, IN 46250
(317) 915-8858
General Practice Attorneys, Attorneys, Legal Service Plans
Pumphrey & Manley
8310 Allison Pointe Blvd
Indianapolis, IN 46250
(317) 842-8828
Criminal Law Attorneys
Moyer WM C Atty
815 Cedar Bough Pl
New Albany, IN 47150
(812) 948-8706
Attorneys
Northrop Joseph S
53 W State St
Huntington, IN 46750
(260) 356-8666
Attorneys,  Family Law Attorneys,  General Practice Attorneys,  Legal Service Plans,  Criminal Law A
Forker W Jonathan
609 Michigan Ave
La Porte, IN 46350
(219) 362-8521
Attorneys,  Family Law Attorneys,  Accident & Property Damage Attorneys,  Legal Service Plans
12Law.com   |  NASHVILLE, TN USA   |  CONTACT US