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 Zip Code 98352

A Primer on Estate & Inheritance Taxes in Zip Code 98352


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 WA 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 WA Power of Attorney Create This Document
Page 1
Page 2
Page 3
Page 4
Page 5
Related Legal Services near Zip Code 98352
Chvatal, Law
1111 Jadwin Ave
Richland, WA 99352
(509) 591-9894
Attorneys, Civil Litigation & Trial Law Attorneys
Risenmay Law Firm P
18300 NE Union Hill Rd Ste 230
Redmond, WA 98052
(425) 882-9745
General Practice Attorneys, Attorneys, Legal Service Plans
Tuttle & Assoc
8158 164th Ave NE
Redmond, WA 98052
(425) 881-9100
Personal Injury Law Attorneys, Attorneys, Attorneys Referral & Information Service
Arnold Daniel
421 Nicklaus Ct
Richland, WA 99352
(509) 628-8528
Attorneys, Legal Service Plans
Suasan Millican O'Brian
7525 166th Ave NE Ste D230
Redmond, WA 98052
(425) 869-8067
Divorce Attorneys,  Child Custody Attorneys,  Attorneys,  Family Law Attorneys
Cowles Peter F
8201 164th Ave NE
Redmond, WA 98052
(425) 882-7900
Probate Law Attorneys, Attorneys
Cowles Peter F
18300 NE Union Hill Rd Ste 210
Redmond, WA 98052
(425) 882-7900
Attorneys
Atherton Richard
8158 164th Ave NE
Redmond, WA 98052
(425) 881-7881
General Practice Attorneys, Attorneys
Hansen, G Olaf - Magnuson Lowell
16398 NE 85th St # 200
Redmond, WA 98052
(425) 885-7500
General Practice Attorneys, Attorneys, Legal Service Plans
Stanton Cole, Attorney
16398 NE 85th St Ste 200
Redmond, WA 98052
(425) 885-7500
Attorneys,  Family Law Attorneys,  Legal Clinics,  Legal Service Plans
Matthew L. Rutt
719 Jadwin Ave Suite 23-B
Richland, WA 99352
(509) 943-7000
Criminal Law Attorneys, Attorneys, Legal Service Plans
Christine Bennett
710 & 1/2 The Prwy
Richland, WA 99352
(509) 378-6978
Family Law Attorneys,  Attorneys,  Traffic Law Attorneys,  Criminal Law Attorneys,  DUI & DWI Attorn
Powell & Gunter
1025 Jadwin Ave
Richland, WA 99352
(509) 943-6781
General Practice Attorneys, Attorneys
Karmali Law Office P
8201 164th Ave NE Ste 200
Redmond, WA 98052
(425) 629-6300
General Practice Attorneys, Attorneys, Legal Service Plans
A+Bankruptcy Assistance for Ch 7
22511 137th St NE
Granite Falls, WA 98252
(425) 268-5682
Attorneys, Business Bankruptcy Law Attorneys, Bankruptcy Law Attorneys
Three Rivers Community Fndtn
1333 Columbia Park Trl Ste 310
Richland, WA 99352
(509) 735-5559
Estate Planning Attorneys,  Estate Planning, Probate, & Living Trusts,  Attorneys,  Legal Service
Feeney Kerri
1177 Jadwin Ave # 4
Richland, WA 99352
(509) 946-5200
General Practice Attorneys, Attorneys, Legal Service Plans
Armstrong Klym Waite & Atwood
660 Swift Blvd # A
Richland, WA 99352
(509) 943-4681
Attorneys,  Criminal Law Attorneys,  Family Law Attorneys,  Probate Law Attorneys,  Social Security
Klym Arthur D
660 Swift Blvd # A
Richland, WA 99352
(509) 943-4681
Attorneys, Criminal Law Attorneys, Family Law Attorneys, Probate Law Attorneys, Social Security & Di
Heye Tom
1333 Columbia Park Trl # 220
Richland, WA 99352
(509) 735-4444
Attorneys
Walker P Craig
1333 Columbia Park Trl # 220
Richland, WA 99352
(509) 735-4444
Real Estate Attorneys, Attorneys, Legal Service Plans
Gibbs Law Offices
15600 Redmond Way
Redmond, WA 98052
(206) 734-4374
General Practice Attorneys, Attorneys
Environmental Law Northwest
17371 NE 67th Ct Ste B208
Redmond, WA 98052
(425) 556-4303
Environment & Natural Resources Law Attorneys, Attorneys
Dow Law Firm
1060 Jadwin Ave Suite 125
Richland, WA 99352
(509) 946-4100
Collection Law Attorneys,  Attorneys,  Bankruptcy Law Attorneys,  Bankruptcy Services
12Law.com   |  NASHVILLE, TN USA   |  CONTACT US