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 Grant, MI

A Primer on Estate & Inheritance Taxes in Grant, MI


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 MI 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 MI Power of Attorney Create This Document
Page 1
Page 2
Page 3
Page 4
Page 5
Related Legal Services near Grant, MI
Jennings Law PC
4233 Red Arrow Hwy
Stevensville, MI 49127
(269) 429-9999
Attorneys,  Adoption Law Attorneys,  Family Law Attorneys,  Probate Law Attorneys,  Wills, Trusts &
Dean F Eldon
1370 N Oakland Blvd # 110
Waterford, MI 48327
(248) 666-9880
Attorneys, Criminal Law Attorneys
Ford, Frank B
5944 Dacosta St
Dearborn Heights, MI 48127
(313) 565-9289
DUI & DWI Attorneys,  Attorneys,  Traffic Law Attorneys,  Criminal Law Attorneys
Vihtelic James W
24624 W Warren St
Dearborn Heights, MI 48127
(313) 562-9260
Attorneys, General Practice Attorneys
Lillian Diallo
65 Cadillac Road, Ste 3610
Detroit, MI 48227
(313) 719-8819
Criminal Law Attorneys, Attorneys, DUI & DWI Attorneys
Isgrigg John PLC
6515 Highland Rd
Waterford, MI 48327
(248) 886-8622
Probate Law Attorneys,  Wills, Trusts & Estate Planning Attorneys,  Business Law Attorneys,  Elder
John P Ternes Atty
319 S Lake St
East Jordan, MI 49727
(231) 536-7910
Elder Law Attorneys, Attorneys
Scott Anna M
2487 S Michigan Rd
Eaton Rapids, MI 48827
(517) 663-7909
General Practice Attorneys, Attorneys, Legal Service Plans
Hurwitz & Gantz PC
8283 N Telegraph Rd Ste 1
Dearborn Heights, MI 48127
(313) 278-7030
Attorneys, Legal Service Plans
Borowsky Victor & Associates
23500 Ford Rd
Dearborn Heights, MI 48127
(313) 278-6500
Probate Law Attorneys,  Attorneys,  Wills, Trusts & Estate Planning Attorneys,  Real Estate Attorne
Law Office Jospeh P Saulski PLLC
6515 Highland Rd
Waterford, MI 48327
(248) 666-6004
General Practice Attorneys, Attorneys
Blake Marvin
8283 N Telegraph Rd
Dearborn Heights, MI 48127
(313) 562-5955
Attorneys
Philip R. Fabrizio
6515 Highland Rd
Waterford, MI 48327
(248) 666-5924
Attorneys,  Social Security & Disability Law Attorneys,  Legal Service Plans,  Administrative & Gove
JF Legal Services
7400 Highland Rd. Ste. 140
Waterford, MI 48327
(248) 383-5293
Criminal Law Attorneys, Estate Planning Attorneys, Family Law Attorneys, General Practice Attorneys
Craig Robert Law Offices
26940 Berea Ave
Dearborn Heights, MI 48127
(313) 565-5012
General Practice Attorneys, Attorneys
Bitar Daniel
24945 W Warren St
Dearborn Heights, MI 48127
(313) 278-4708
Attorneys
Fresh Start-Bankruptcy Law Ofc
23843 Joy Rd
Dearborn Heights, MI 48127
(313) 565-4252
Bankruptcy Law Attorneys, Attorneys, General Practice Attorneys, Bankruptcy Services, Legal Service
Frego & Associates - The Bankruptcy Law Office PLC
23843 Joy Rd
Dearborn Heights, MI 48127
(313) 565-4252
Bankruptcy Law Attorneys, Attorneys, Bankruptcy Services
Roger J Ettlinger
6515 Highland Rd
Waterford, MI 48327
(248) 624-4120
General Practice Attorneys, Attorneys, Legal Service Plans
Advanced Bankruptcy
8611 N Telegraph Rd
Dearborn Heights, MI 48127
(800) 395-4065
Bankruptcy Law Attorneys,  Bankruptcy Services,  Attorneys,  Financial Services
Rock & Borgelt
24500 Ford Rd Ste 10
Dearborn Heights, MI 48127
(313) 274-4064
Accident & Property Damage Attorneys, Attorneys, Legal Service Plans
Donald M Rivard PC
24624 W Warren St
Dearborn Heights, MI 48127
(313) 565-3411
General Practice Attorneys, Attorneys
Nolan Lawrence P
239 S Main St
Eaton Rapids, MI 48827
(517) 663-3306
General Practice Attorneys, Legal Service Plans, Attorneys
Villas Gary G
239 S Main St
Eaton Rapids, MI 48827
(517) 663-3306
Attorneys
12Law.com   |  NASHVILLE, TN USA   |  CONTACT US