Overview of Vermont Estate Tax Laws

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Understanding How Vermont Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Vermont, then you live in one of a handful of states that still collect a local death tax. The estates of Vermont residents, as well as the estates of nonresidents who own real estate and/or tangible personal property and/or income-producing property located in Vermont, are subject to a local death tax under the following guidelines.

NOTE: State and local laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the Vermont estate tax?

If the decedent was a resident of Vermont at the time of death, the estate may be subject to the Vermont estate tax if the federal gross estate exceeds $2,750,000 on the date of death or if the estate is required to file a federal estate tax return, IRS Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return.

For nonresidents of Vermont, an estate may be subject to the Vermont estate tax if it includes Vermont sitused property (real estate, tangible personal property, and/or income-producing property sitused in Vermont) and the federal gross estate exceeds $2,750,000 on the date of death or if the estate is required to file a federal estate tax return.

Note: The Vermont estate tax exemption was increased to $2,750,000 on January 1, 2011. Prior to this date, the exemption was as follows:

2006 - 2010 = $2,000,000
2004 - 2005 = $1,500,000
2002 - 2003 = $1,000,000
2001 - 2002 = $675,000

What Vermont estate tax forms must be filed?

The personal representative or other fiduciary representing an estate that is subject to the Vermont estate tax must complete and file the Vermont Estate Tax Return, Form E-1.

Additional documents that must be filed with the Vermont Department of Taxes when a Vermont Estate Tax Return is required to filed are as follows:

If no federal estate tax is due and no federal estate tax return (IRS Form 706) is required to be filed, nonetheless the estate representative must complete and file a pro forma IRS Form 706, including all exhibits and appraisals, with the Vermont Estate Tax Return.

When federal estate tax is due and all assets are located in Vermont, the first page of IRS Form 706 must be included with the Vermont estate tax return.

When federal estate tax is due and some assets are located outside of Vermont, IRS Form 706 must be attached to the Vermont Estate Tax Return, but excluding exhibits and appraisals.

A duplicate of the Estate Tax Closing Letter issued by the IRS must be filed with the Vermont Department of Taxes.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a Vermont death tax may be due on the B Trust after the first spouse's death due to the gap of $2,500,000 between the Vermont exemption of $2,750,000 and the 2013 federal exemption of $5,250,000. While some states allow a married decedent's estate to make an election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP" for short) for purposes of calculating the local estate tax, Vermont law does not specifically allow for this. However, one commentator on Vermont estate taxes has stated that "representatives of the Vermont Department of Taxes have stated informally that Vermont will recognize whole or partial QTIP elections for properly drafted trusts as long as the election is, or would be, binding for both federal and Vermont estate tax purposes." (See Planning for the Vermont Estate Tax for more about this issue.) Thus, married Vermont residents should consult with a Vermont estate planning attorney to determine if they can incorporate ABC Trust planning into their estate plans.

When are the Vermont estate tax return and tax payment due?

The Vermont Estate Tax Return, Form E-1, must be filed, and any estate tax due must be paid, within 9 months of the decedent's date of death. An extension of time to file the Vermont Estate Tax Return does not extend the time to pay, so an estimate of the estate tax to be due must be paid with the extension of time request. Where are the Vermont estate tax return filed and tax payment made?

Mail all required forms and any payment due to:

Vermont Department of Taxes
133 State Street
Montpelier, VT 05633-1401

What is the Vermont estate tax rate and how is the tax calculated?

Computing the Vermont estate tax is a convoluted process. According to Vermont estate planning attorney Richard W. Kozlowski, the Vermont estate tax is based on "a complicated and slightly regressive tax system, with marginal tax brackets that begin at 35% (for the first dollars in excess of $2.75 million) and then decrease to 9.6% for estates in excess of $3.4 million, and then rise again to a max rate of 16% for estates in the $10+ million range." (See ESTATE TAXATION - FEDERAL & VERMONT on Mr. Kozlowski's website for his overview of Vermont estate taxes.)

Page 4 of the current Vermont Estate Tax Return, Form E-1, contains "Computation Schedules" for calculating the Vermont estate tax bill for residents and nonresidents.

Where can I find additional information about Vermont estate taxes?

For more information about Vermont estate taxes, refer to the Vermont Department of Taxation's website: Vermont Estate Tax.

You may also call the Vermont Department of Taxation at (802) 828-6820.

Refer to Vermont estate planning attorney Richard W. Kozlowski's article, ESTATE TAXATION - FEDERAL & VERMONT, for an overview of the Vermont estate tax laws.

Does Vermont collect an inheritance tax?

Does Vermont collect a local inheritance tax, which is a tax assessed against the share received by each individual beneficiary of an estate as opposed to an estate tax, which is assessed against the entire estate? The answer to this question is No, Vermont does not collect a local inheritance tax.

Overview of Tennessee Inheritance Tax Laws for 2013

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Understanding How Tennessee Inheritance Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Tennessee, then you live in one of a handful of states that collects a state death tax. The estates of Tennessee residents who die in 2013, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Tennessee, are subject to a state death tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

Estate Tax vs. Inheritance Tax

While the Tennessee death tax is referred to as an "inheritance tax" in the Tennessee legislative code, it is really an estate tax since it is collected based on the value of the overall estate located in Tennessee (hence, a true "estate tax"); it is not a tax that is collected based on who actually inherits the estate located in Tennessee (a true "inheritance tax").

Interestingly enough, the Tennessee legislative code also provides for an "estate tax," which is actually a type of "pick up tax" that was tied to the amount of federal estate tax that was collected from the estates of decedents who died before 2005.

Since the Tennessee legislative code refers to both an inheritance tax and an estate tax, this article refers to the death tax that is currently collected under Tennessee law as an "inheritance tax," even though the tax is assessed against the assets located in Tennessee and not against the individual beneficiaries who inherit the estate.

When is an estate subject to the Tennessee inheritance tax in 2013?

For Tennessee residents, an estate may be subject to the Tennessee inheritance tax if the total gross estate exceeds $1,250,000.

For nonresidents of Tennessee, an estate may be subject to the Tennessee inheritance tax if it includes real estate and/or tangible personal property having a situs within the state of Tennessee and the gross estate exceeds $1,250,000.

Note: In May 2012, legislation was enacted which will phase out the Tennessee inheritance tax by 2016. See more on this below in the section titled "What is the future of the Tennessee inheritance tax?"

What Tennessee inheritance tax forms must be filed?

All estates with a gross value that exceeds $1,250,000 must file a Tennessee inheritance tax return, Form INH-301, even if no Tennessee inheritance tax will be due as a result of applicable deductions and exemptions.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a Tennessee inheritance tax may be due on the B Trust after the first spouse's death if there is a gap between the Tennessee inheritance tax exemption and the federal estate tax exemption. Nonetheless, a married decedent's estate can make an election on Form INH-301 to treat property as marital deduction qualified terminable interest property ("QTIP") for purposes of calculating the Tennessee inheritance tax. Thus, married Tennessee residents can defer payment of both Tennessee and federal death taxes until after the death of the surviving spouse using ABC Trust planning.

When are the Tennessee inheritance tax return and tax payment due?

Form INH-301 must be filed and any inheritance tax due must be paid within nine months after the decedent's date of death unless an extension of time to file the return and pay the tax is granted. An extension of time to file Form INH-301 may be requested for up to one year by filing Form INH-304, Application for Extension of Time to File Inheritance Tax Return. Nonetheless, even if an extension is granted, it will not delay the time for payment of any inheritance tax that may be due.

Where is the Tennessee inheritance tax return filed?

Mail the Tennessee inheritance tax return, Form INH-301, and all other required forms to:

Tennessee Department of Revenue
Andrew Jackson State Office Building 500
Deaderick Street
Nashville, Tennessee 37242-0600

What are the Tennessee inheritance tax rates?

Anything over the $1,250,000 Tennessee inheritance exemption for 2013 is taxed at the following rates:

Where can I find additional information about Tennessee inheritance taxes?

For more information about Tennessee inheritance taxes and estate taxes, refer to the Tennessee Department of Revenue's Inheritance Tax webpage, Guide to Tennessee Inheritance and Estate Taxes, and Inheritance Tax Guide.

For assistance with Form INH-301 and Tennessee inheritance tax questions, call the Tennessee Department of Revenue toll free (in state only) at 800-342-1003 or 615-253-0600.

For information about the rules that apply to the estates of decedents who died in 2012 and prior years, refer to Overview of Tennessee Inheritance Tax Laws for 2012 and Prior Years.

Overview of Rhode Island Estate Tax Laws

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Understanding How Rhode Island Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

NOTE: State laws change frequently and the following information may not reflect recent changes in the laws. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

If you live in Rhode Island, then you live in one of the remaining states that collects a state estate tax or a state inheritance tax. The estates of Rhode Island residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Rhode Island, are subject to a state estate tax under the following guidelines.

When is a Rhode Island Estate Tax Return Required to be Filed?

For a Rhode Island resident, a Rhode Island Estate Tax Return, Form 100A, must be filed if the decedent's gross estate plus adjusted taxable gifts exceeds $675,000 in 2009, $850,000 in 2010, $859,350 in 2011, $892,865 in 2012, or $910,725 in 2013.

For a nonresident, the estate must file Form 100A if the estate includes real or tangible personal property located in Rhode Island and the gross estate plus adjusted taxable gifts exceeds $675,000 in 2009, $850,000 in 2010, $859,350 in 2011, $892,865 in 2012 or $910,725 in 2013.

A signed copy of the federal estate tax return, IRS Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, must accompany Form 100A if the estate is required to file Form 706.

Note: The Rhode Island estate tax exemption increased from $675,000 to $850,000 on January 1, 2010, and has been indexed for inflation beginning in 2011.

When is the Rhode Island Estate Tax Return and Any Payment Required Due?

Form 100A must be filed and any tax due must be paid within nine months of the decedent's death.

An extension of time to file Form 100A may be requested, however, even if an extension is granted it won't delay the time for payment of any tax due.

Where is the Rhode Island Estate Tax Return Filed?

Mail the Rhode Estate Tax Return (Form 100A), a $25.00 filing fee, any payment due, and all other required forms to:

Rhode Island Division of Taxation Estate Tax Section
One Capitol Hill
Providence, RI 02908

Make checks payable to "RI Division of Taxation."

What is the Rhode Island Estate Tax Rate?

The tax rate is a progressive rate that maxes out at 16% for the amount above $10,040,000.

Are Transfers to a Surviving Spouse Taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used traditional AB Trust planning to reduce their federal estate tax bill, a Rhode Island estate tax may be due on the B Trust after the first spouse's death since there is a gap between the Rhode Island estate tax exemption and the federal estate tax exemption (for example, the gap in 2012 is equal to a whopping $4,107,135). A married decedent's estate is, however, authorized to make an election on Form 100A to treat property as marital deduction qualified terminable interest property ("QTIP") for Rhode Island purposes, so married Rhode Island couples can defer payment of both Rhode Island estate taxes and federal estate taxes until after the death of the surviving spouse by using an ABC Trust scheme instead of AB Trust planning.

Do Nontaxable Estates Have to File Any Forms?

For gross estates valued at the exemption amount or less, Form 100, Estate Tax Credit Transmittal, can be filed to obtain discharge of the automatic statutory lien that attaches to all Rhode Island real estate a person owns at death, to obtain a Notice of No Tax Due for probate administration purposes, and to allow the sale of Rhode Island securities, including Rhode Island incorporated stock, Rhode Island state and municipal bonds, and mutual funds organized as business trusts that do business in Rhode Island.

Form 100 should be signed by the executor, administrator, trustee or heir at law of the deceased person. It should be mailed along with a death certificate and $25.00 filing fee to the address listed above for Form 100A.

Note: As mentioned above, the Rhode Island estate tax exemption was increased from $675,000 to $850,000 on January 1, 2010, and was then indexed for inflation beginning in 2011. Does Rhode Island Impose a Lien on the Deceased Person's Property?

Form T-77, Discharge of Lien Form, must be filed along with Form 100A or Form 100 if the decedent had any interest in real estate located in Rhode Island. Form T-77 must be filed in triplicate and the description of the real estate must be stated as the tax assessor's description which can be found on the property tax bill issued by the applicable city or town.

Form T-79, Estate Tax Waiver Form, must be filed along with Form 100A or Form 100 if the decedent had any interest in a security of a Rhode Island incorporated business requiring an estate tax waiver. Form T-79 must be filed in duplicate.

Where Can I Find Additional Information About Rhode Island Estate Taxes?

For more information about Rhode Island estate taxes, refer to the Rhode Island Division of Taxation website.

Overview of Oregon Estate Tax Laws

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Understanding How Oregon Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Oregon, then you live in one of a handful of states that collects a state death tax. The estates of Oregon residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Oregon, are subject to a state death tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

Does Oregon collect an estate tax or an inheritance tax?

Prior to 2012, the Oregon death tax was referred to as an "inheritance tax" in the Oregon code, but effective January 1, 2012, the Oregon death tax became known as an "estate tax." This makes sense since Oregon's death tax is collected based on the value of the estate (hence, an "estate tax"), as opposed to being based on who inherits the estate (hence, an "inheritance tax").

In this article, the Oregon death tax collected on or before December 31, 2011 is referred to as an inheritance tax, the Oregon death tax collected on or after January 1, 2012 is referred to as an estate tax, and both taxes are referred to in general as the death tax.

When is an estate subject to the Oregon inheritance tax or estate tax?

For Oregon residents, an estate may be subject to the Oregon inheritance tax or estate tax if the total gross estate exceeds $1,000,000.

For nonresidents of Oregon, an estate may be subject to the Oregon inheritance tax or estate tax if it includes real estate and/or tangible personal property having a situs within the state of Oregon and the gross estate exceeds $1,000,000.

What Oregon inheritance tax or estate tax forms must be filed?

For deaths that occurred on or before December 31, 2011, estates with a gross value that exceeds $1,000,000 must file an Oregon inheritance tax return, Form IT-1, even if no Oregon inheritance tax will be due as a result of applicable deductions and exemptions.

For deaths that occurred on or after January 1, 2012, estates with a gross value that exceeds $1,000,000 must file an Oregon estate tax return, Form OR706, even if no Oregon estate tax will be due as a result of applicable deductions and exemptions.

Are Oregon Registered Domestic Partners treated the same as married couples?

In 2007 the Oregon legislature passed HB 2007. Under the provisions of this law, the instructions for the Form IT-1 were amended to provide that the term “surviving spouse” may be replaced with "surviving Oregon Registered Domestic Partner."

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse or registered domestic partner are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, an Oregon death tax may be due on the B Trust after the first spouse's death due to the gap of $4,120,000 between the Oregon exemption of $1,000,000 and the federal exemption of $5,120,000. Nonetheless, a married decedent's estate can make an election to treat a trust of which the surviving spouse is the sole beneficiary as "special marital property" for purposes of calculating the Oregon death tax. Thus, married Oregon residents can defer payment of both Oregon and federal death taxes until after the death of the surviving spouse using ABC Trust planning.

When are the Oregon death tax return and tax payment due?

The Oregon death tax return must be filed and any death tax due must be paid within nine months after the decedent's date of death.

An extension of time to file the Oregon death tax return and pay any tax due will be accepted for Oregon if granted by the Internal Revenue Service. If the estate does not have to file a federal estate tax return, then mark "For Oregon Only" at the top of IRS Form 4768 and federal guidelines will be used to consider the request. If an extension of time to pay is granted, the tax must be secured by collateral acceptable to the Oregon Department of Revenue. In addition, an extension of time to file the return does not extend the time to pay the tax, and interest will accrue during the extension period.

Where is the Oregon death tax return filed?

Mail the Oregon inheritance tax return, Form IT-1, or the Oregon estate tax return, Form OR706, and all other required forms and documentation to:

Oregon Department of Revenue
P.O. Box 14110
Salem, OR 97309-0910

If you are using a private delivery service such as FedEx or UPS, then use the following address:

Oregon Department of Revenue
955 Center Street
NE Salem, OR 97301-2555

What are the Oregon inheritance tax or estate tax rates?

For deaths that occurred on or before December 31, 2011, once the value of the net estate exceeded $1,000,000, the entire value of the estate was taxed. Inheritance tax rates ranged from 0.8% to 16% of the adjusted taxable estate.

For deaths that occurred on or after January 1, 2012, the first $1,000,000 of an estate is exempt from the estate tax calculation. For a table showing the estate tax rates that went into effect on January 1, 2012, refer to Lawmakers Tweak Oregon Estate Tax.

Overview of New York Estate Tax Laws

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Understanding How New York Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in New York, then you live in one of a handful of states that collects a state estate tax. The estates of New York residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in New York, are subject to a state estate tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the New York estate tax?

For New York residents, an estate may be subject to the New York estate tax if the total of the federal gross estate, plus the federal adjusted taxable gifts and specific exemption, exceeds $1,000,000.

For nonresident U.S. citizens, an estate may be subject to the New York estate tax if it includes real estate or tangible personal property having a situs within the state of New York and the gross estate, plus federal adjusted taxable gifts and specific exemption, exceeds $1,000,000.

For nonresident, non-U.S. citizens, an estate may be subject to the New York estate tax if it includes real or tangible personal property having a situs within the state of New York and the estate is required to file a federal estate tax return (Form 706-NA).

What New York estate tax forms must be filed?

Each estate that may be subject to the New York estate tax as described above must file a Form ET-706, New York State Estate Tax Return.

The estate of a nonresident must also file Form ET-141, New York State Estate Tax Domicile Affidavit.

Aside from these New York forms, the starting point for Form ET-706 is the federal estate tax return, IRS Form 706. Thus, a completed IRS Form 706 (or IRS Form 706-NA for a noncitizen, non-U.S. resident) with all schedules and supporting documents must be completed and submitted with New York Form ET-706 even if the estate is not required to file a federal estate return.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a New York estate tax may be due on the B Trust after the first spouse's death due to the gap of $4,250,000 between the New York estate tax exemption of $1,000,000 and the 2013 federal estate tax exemption of $5,250,000. A married decedent's estate is NOT authorized to make an election on Form ET-706 to treat property as marital deduction qualified terminable interest property ("QTIP"). What this means is that married couples cannot defer payment of both New York estate taxes and federal estate taxes until after the death of the surviving spouse using an ABC Trust scheme.

When is the New York estate tax return and any payment required due?

Form ET-706 must be filed and any tax due must be paid within nine months after the decedent’s date of death unless an extension of time to file the return and pay the tax is received.

An extension of time to pay the estate tax for up to four years from the date of death may be granted if it is established that payment of any part of the tax within nine months from the date of death would result in undue hardship to the estate, but annual installments may be required. Extensions of time to file the return, pay the tax, or both, are requested on Form ET-133.

Where is the New York estate tax return filed?

Mail the New York estate tax return, Form 706-ET, and all other required forms to:

NYS Estate Tax Processing Center
P.O. Box 15167
Albany, NY 12212-5167

What is the New York estate tax rate?

The New York estate tax rate is a progressive one that starts at 5.085% and rises to 16% for the amount above $10,040,000.

Where can I find additional information about New York estate taxes?

For more information about New York estate taxes, refer to the New York Department of Taxation and Finance website.

How can I get an estimate of my New York estate tax liability?

To calculate an estimate of your New York estate tax liability, refer to the following calculator offered by the New York law firm of Cohen & Schwartz, LLP: New York Estate Tax Calculator

 

Overview of New Jersey Estate Tax Laws

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Understanding How New Jersey Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

NOTE: State laws change frequently and the following information may not reflect recent changes in the laws. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

In addition to a state inheritance tax, New Jersey also imposes a separate state estate tax which has been decoupled from the federal estate tax laws. Here is a summary of the current New Jersey estate tax laws.

When is a New Jersey Estate Tax Return Required to be Filed?

A New Jersey estate tax return, Form IT-Estate, must be filed if the decedent's gross estate plus adjusted taxable gifts exceeds $675,000. How is the New Jersey Estate Tax Calculated?

The New Jersey estate tax is either the maximum credit for state inheritance, estate, succession or legacy taxes allowable under the provisions of the Internal Revenue Code in effect on December 31, 2001 (this is called the "Form 706 Method"), or an amount determined pursuant to the Simplified Tax System prescribed by the Director, Division of Taxation (this is called the "Simplified Form Method").

The Form 706 Method must be used if the taxpayer is required to file a federal estate tax return, IRS Form 706.

If the taxpayer isn't required to file IRS Form 706, then, in addition to the Form 706 Method, the Simplified Form Method may be used provided that it produces a tax liability similar to the Form 706 Method.

When is the New Jersey Estate Tax Return and Any Payment Required Due?

Form IT-Estate must be filed and any tax due must be paid within nine months of the decedent's death, or nine months plus 30 days if the Form 706 Method is used.

An extension of time to file Form IT-Estate may be requested, however, even if an extension is granted it won't delay the time for payment of any tax due.

The Form 706 Method requires that Form IT-Estate be prepared and filed along with a 2001 IRS Form 706. This is in addition to IRS Form 706 for the year of the decedent's death if one is required to be filed. Where is the New Jersey Estate Tax Return Filed?

Mail the New Jersey estate tax return, Form IT-Estate, and all other required forms to:

NJ Inheritance Tax and Estate Tax
P.O. Box 249
Trenton, New Jersey 08695-0249

What is the New Jersey Estate Tax Rate?

The tax rate is a progressive rate that maxes out at 16% for the amount above $10,040,000.

Are Transfers to a Surviving Spouse Taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a New Jersey estate tax may be due on the B Trust after the first spouse's death if there is a gap between the New Jersey estate tax exemption and the federal estate tax exemption at the time the federal estate tax comes back into effect. A married decedent's estate is authorized to make an election on Form IT-Estate to treat property as marital deduction qualified terminable interest property ("QTIP") for New Jersey purposes, but married New Jersey couples cannot defer payment of both New Jersey estate taxes and federal estate taxes until after the death of the surviving spouse using an ABC Trust scheme.

Are Transfers to a Surviving Domestic Partner Taxable?

Federal estate tax laws do not have a provision providing a deduction for property passing to a domestic partner. However, if a New Jersey decedent was a partner in a civil union and died on or after February 19, 2007, and was survived by his or her partner, then a marital deduction equal to that permitted to a surviving spouse under the provisions of the Internal Revenue Code in effect on December 31, 2001, is permitted for New Jersey estate tax purposes.

Does New Jersey Impose a Lien on the Deceased Person's Property?

For New Jersey decedents dying after December 31, 2001, the New Jersey estate tax remains a lien on all property of the decedent as of the date of death until paid. No property may be transferred without the written consent of the Director of the Division of Taxation.

Where Can I Find Additional Information About New Jersey Estate Taxes?

For more information about New Jersey estate taxes, refer to New Jersey Inheritance and Estate Tax General Information on the New Jersey Division of Taxation website.

Overview of Minnesota Estate Tax Laws

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Understanding How Minnesota Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Minnesota, then you live in one of a handful of states that still collect a local death tax. The estates of Minnesota residents, as well as the estates of nonresidents who own real estate and/or tangible personal property and/or business interests located in Minnesota, are subject to a local death tax under the following guidelines.

NOTE: State and local laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice. When is an estate subject to the Minnesota estate tax?

If the decedent was a resident of Minnesota at the time of death, the estate may be subject to the Minnesota estate tax if the federal gross estate exceeds $1,000,000 on the date of death or if the estate is required to file a federal estate tax return, IRS Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return.

For nonresidents of Minnesota, an estate may be subject to the Minnesota estate tax if it includes Minnesota sitused property and the federal gross estate exceeds $1,000,000 on the date of death or if the estate is required to file a federal estate tax return. Note that new legislation passed in late May 2013 and expected to be signed into law by Governor Mark Dayton will subject Minnesota property owned by an S corporation, partnership, LLC or a trust of which a nonresident is a shareholder, partner, member or beneficiary to the Minnesota estate tax.

What Minnesota estate tax forms must be filed?

The estate representative of an estate that is subject to the Minnesota estate tax must complete and file the Minnesota Estate Tax Return, Form M706.

Note that as indicated above, a Minnesota Estate Tax Return may be required to be filed even if a federal estate tax return, IRS Form 706, is not required to be filed. Thus, the estate representative must first complete IRS Form 706 for the year of death before completing Form M706.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a Minnesota death tax may be due on the B Trust after the first spouse's death due to the gap of $4,250,000 between the Minnesota exemption of $1,000,000 and the 2013 federal exemption of $5,250,000. While some states allow a married decedent's estate to make an election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP" for short) for purposes of calculating the local estate tax, Minnesota law does not allow for this. Thus, married Minnesota residents cannot incorporate ABC Trust planning into their estate plans.

When are the Minnesota estate tax return and tax payment due?

The Minnesota Estate Tax Return, M706, must be filed, and any estate tax due must be paid, within 9 months after the decedent's date of death.

All estates are granted an automatic six-month extension of time to file Form M706. This means that a written request is not required to be submitted to the Minnesota Estate Tax Unit to request an extension to file. But regardless of whether or not IRS Form 706 is required to be filed, each estate has either 15 months from the decedent's date of death in which to file M706, or the maximum amount of time granted by the IRS in which to file IRS Form 706, whichever is longer.

There is no extension of time to pay the Minnesota estate tax allowed. Thus, any tax not paid by the regular due date will be subject to penalties and interest.

Where are the Minnesota estate tax return filed and tax payment made?

You can use one of the mailing labels provided in the instructions for Form M706 to mail your return and all required attachments to the Minnesota Department of Revenue.

If you choose not to use the label, mail your forms to:

Minnesota Estate Tax
Mail Station 1315
St. Paul, MN 55146-1315

Minnesota estate taxes can be paid electronically online or by check.

To pay electronically, login to e-services. Enter the decedent's Social Security number and follow the prompts for individuals to make an estate tax return or an extension payment. You will receive a confirmation number when your transaction is complete.

For payment by check, make the check payable to "Minnesota Revenue" and mail the check with the appropriate payment voucher. For a tax return payment (taxes due with Form M706), complete and attach the voucher Form PV47. For an extension payment, complete and attach voucher Form PV86. Follow the instructions on the voucher.​ How is the Minnesota estate tax calculated?

Minnesota did not adopt the changes in the federal Economic Growth and Tax Relief Reconciliation Act of 2001. Thus, you must read the instructions for Form M706 for details on how to determine the federal gross estate and how to calculate the Minnesota estate tax. In addition, you must use the tax tables found in the Form M706 instructions and not the tables in the IRS Form 706 instructions in order to calculate the Minnesota estate tax due.

Also note that you can use the Minnesota Estate Tax Calculators for the applicable year of death provided on the Department of Revenue's website in order to verify that you have properly calculated the Minnesota estate tax due.

What is the Minnesota estate tax rate?

In general, a Minnesota estate will be subject to a tax of approximately 10%. However, the only way to calculate the exact amount of tax due is to complete the applicable IRS Form 706 and Minnesota Form M706. Where can I find additional information about Minnesota estate taxes?

For more information about Minnesota estate taxes, refer to the Minnesota Department of Revenue's Estate Tax Frequently Asked Questions.

You may also call the Estate Tax Unit at 651-556-3075 between 8:00 a.m.- 4:30 p.m. Monday through Friday, or email the unit by following this link and clicking on "email" on the right hand side of the page: Estate Tax.

Overview of Massachusetts Estate Tax Laws

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Understanding How Massachusetts Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Massachusetts, then you live in one of a handful of states that still collect a state estate tax. The estates of Massachusetts residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Massachusetts, are subject to a state estate tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the Massachusetts estate tax?

For Massachusetts residents, an estate may be subject to the Massachusetts estate tax if the value of the gross estate, plus adjusted taxable gifts, exceeds the applicable exclusion amount in the Internal Revenue Code in effect on December 31, 2000. The applicable exclusion amounts for Massachusetts estate tax purposes are $700,000 for 2003, $850,000 for 2004, $950,000 for 2005, and $1,000,000 for 2006 and later years. Thus, in general, under current law an estate may be subject to the Massachusetts estate tax if the value exceeds $1,000,000. For nonresidents of Massachusetts, an estate may be subject to the Massachusetts estate tax if it includes real estate or tangible personal property having a taxable situs within the state of Massachusetts and the value of the gross estate exceeds $1,000,000 under the criteria set forth above.

What Massachusetts estate tax forms must be filed?

The estate representative of an estate that is subject to the Massachusetts estate tax must first complete a federal estate tax return, IRS Form 706, with a revision date of July 1999 and all applicable schedules. Once the federal return is completed, the estate representative can prepare the Massachusetts Estate Tax Return, Form M-706.

In addition to IRS Form 706 with a revision date of July 1999 and a Form M-706, the following documents may be required to be filed:

A Federal Closing Letter submitted to the Massachusetts Department of Revenue within two months of receipt, if the filing of a federal Form 706 is required. This includes both the federal letter of acceptance and line adjustments, if any. Copies of federal changes must be accompanied by an Application for Abatement/Amended Return (Form CA-6), or by an amended Form M-706, as appropriate. No Massachusetts Estate Closing Letter will be issued without a copy of the Federal Closing Letter.

A Certificate Releasing Massachusetts Estate Tax Lien (Form M-792) in triplicate for each parcel of real estate where a release of lien is required. A copy of the deed or certificate of title, and the purchase and sale agreement (or mortgage commitment), if any, should be provided.

A Massachusetts Nonresident Decedent Affidavit (Form M-NRA) for the estates of nonresident decedents.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a Massachusetts estate tax may be due on the B Trust as a result of a gap between the Massachusetts exemption and the federal exemption. In 2013, that gap is $4,250,000. Nonetheless, a married decedent's estate can make a Massachusetts-only election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP Trust" for short) for purposes of calculating the Massachusetts estate tax. Thus, since there is a significant gap between the Massachusetts estate tax exemption and the federal exemption and a state-only QTIP election is allowed, married Massachusetts residents can defer payment of both Massachusetts and federal death taxes until after the death of the surviving spouse using ABC Trust planning.

When are the Massachusetts estate tax return and tax payment due?

The Massachusetts estate tax return must be filed, and any estate tax due must be paid, within nine months after the decedent's date of death.

By submitting an "Application for Extension of Time to File Massachusetts Estate Tax Return" (Form M-4768), an extension of time to file Form M-706 may be granted for a reasonable period, provided the application is made on or before the original due date of the return and 100% of the estimated amount of Massachusetts estate tax is paid. Failure to pay at least 80% of the amount of estate tax finally determined to be due on or before the due date will void any extension of time to file, and the return will be subject to the late filing penalty and, possibly, the late payment penalty. Interest will accrue on any unpaid tax from the original due date.

By filing an "Application for Extension of Time to Pay Massachusetts Estate Tax" (Form M-4768A), an extension of time to pay Massachusetts estate taxes may be granted for a reasonable period, but not to exceed six months. However, when an extension of time to pay is granted, interest on any unpaid tax accrues from the original due date. An extension is granted only for reasonable cause. An extension of up to three years from the due date may be granted upon a showing of undue hardship.

Where are the Massachusetts estate tax return filed and tax payment made?

Payment of the Massachusetts estate tax must be made by a check payable to the :Commonwealth of Massachusetts." Enter the decedent’s full name and Social Security number in the memo portion of the check. The executor signing the return is personally liable for payment of any tax shown on the return if it is not otherwise paid.

The return and the tax payment should be sent to the following:

Massachusetts Estate Tax Unit
P.O. Box 7023
Boston, MA 02204

What is the Massachusetts estate tax rate?

Effective for dates of death on or after January 1, 2003, the Massachusetts estate tax for the estates of residents and nonresidents is computed with reference to the allowable federal estate tax credit for state death taxes allowed in the Internal Revenue Code in effect on December 31, 2000.

If an estate consists solely of property subject to Massachusetts estate taxation, it pays to Massachusetts an amount equal to the federal credit for state death taxes computed using the Internal Revenue Code in effect on December 31, 2000.

In the case of a resident of Massachusetts who owned or transferred real estate or tangible personal property located outside of Massachusetts, Massachusetts grants a credit for estate or inheritance taxes properly paid to other states.

In the case of a nonresident of Massachusetts who owned or transferred real estate or tangible personal property located in Massachusetts, the amount of the Massachusetts nonresident estate tax is the proportion of the allowable credit from the federal estate tax return that the gross value of the Massachusetts property bears to the entire federal gross estate wherever situated.

For an explanation and examples on how to calculate the Massachusetts estate tax, refer to following information listed on the Massachusetts Department of Revenue website: A Guide to Estate Taxes (Applicable to dates of death on or after January 1, 2003).

When is a release of Massachusetts estate tax lien required?

For dates of death on or after January 1, 1997, if the amount of the gross estate requires the filing of a Massachusetts estate tax return, a "Certificate Releasing Massachusetts Estate Tax Lien" (Form M-792) is required for real estate that is owned jointly with rights of survivorship or as tenants by the entirety, real estate that is held in a trust and other real estate that is not part of the probate inventory but is includible in the taxable gross estate. Form M-792 may be required for probate real estate where there is a sale pending (or mortgage commitment), and no closing letter has been issued.

For estates of decedents dying on or after January 1, 2003 that are not required to file M-706, an affidavit of the executor, subscribed to under the pains and penalties of perjury, recorded in the applicable Registry of Deeds and accurately stating that the value of the decedent's gross estate does not require a Massachusetts estate tax filing, is required to release the gross estate of the lien. The Massachusetts Department of Revenue does not publish blank affidavits for filing in the Registry of Deeds, although some Registries may publish sample affidavits and provide them to the public.

For the estates of decedents dying on or after January 1, 2003 that equal or exceed the Massachusetts filing requirement for the year of death, the Commissioner of Revenue will release the lien with respect to property if the Commissioner is satisfied that the collection of the tax will not be jeopardized. The Commissioner will release the lien by issuing Form M-792, "Certificate Releasing Massachusetts Estate Tax Lien."

Where can I find additional information about Massachusetts estate taxes?

For more information about Massachusetts estate taxes, refer to the Massachusetts Department of Revenue website: A Guide to Estate Taxes (Applicable to dates of death on or after January 1, 2003).

Overview of Maryland Estate Tax Laws

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Understanding How Maryland Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Maryland, then you live in one of a handful of states that still collect a state estate tax. In addition, Maryland is one of six states that collects a state inheritance tax (New Jersey is the only other state that collects both an estate tax and an inheritance tax.)

The estates of Maryland residents, as well as the estates of nonresidents who own real estate, tangible personal property, and/or one or more business entities located in Maryland, are subject to a state estate tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the Maryland estate tax?

For Maryland residents, an estate may be subject to the Maryland estate tax if the federal gross estate, plus adjusted taxable gifts, plus property for which a Maryland qualified terminal interest property (QTIP) election was previously made on a Maryland estate tax return filed for the estate of the decedent's predeceased spouse, equals or exceeds $1,000,000.

For nonresidents of Maryland, an estate may be subject to the Maryland estate tax if it includes real estate or tangible personal property having a taxable situs within the state of Maryland and the value of the federal gross estate equals or exceeds $1,000,000 under the criteria set forth above.

What Maryland estate tax forms must be filed?

The estate representative of an estate that is subject to the Maryland estate tax must first complete a federal estate tax return, IRS Form 706, for the year of the decedent's death, even if the estate is not required to file a federal estate tax return. Once the federal return is completed, the estate representative can prepare the Maryland Estate Tax Return, Form MET-1.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a Maryland estate tax may be due on the B Trust as a result of a gap between the Maryland exemption and the federal exemption. In 2013, that gap is $4,250,000. Nonetheless, a married decedent's estate can make a Maryland-only election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP Trust" for short) for purposes of calculating the Maryland estate tax. Thus, since there is a gap between the Maryland estate tax exemption and the federal exemption and a state-only QTIP election is allowed, married Maryland residents can defer payment of both Maryland and federal death taxes until after the death of the surviving spouse using ABC Trust planning.

When are the Maryland estate tax return and tax payment due?

The Maryland estate tax return must be filed, and any estate tax due must be paid, within nine months after the decedent's date of death.

An automatic six-month extension of time to file the Maryland estate tax return and related forms may be requested on Form MET-1E (or up to one year if the person required to file the return is located outside of the U.S.); however, this will not extend the time to pay the tax, and interest will accrue during the extension period. In addition, a penalty of up to 10% will be assessed if the estate tax bill is not paid by the estate tax return due date.

Where are the Maryland estate tax return filed and tax payment made?

For Maryland residents, the Maryland Estate Tax Return, Form MET-1, should be filed with the Register of Wills of the county where the decedent's probate estate is being administered or, if no probate estate is required, then in the county where the decedent resided at the time of death.

For nonresidents, file the Maryland Estate Tax Return, Form MET-1, with the Register of Wills of the county where the nonresident owned real estate or tangible personal property.

For links to all 24 Maryland Register of Wills websites, refer to the Office of the Register of Wills website.

Mail the estate tax payment directly to the Comptroller of Maryland on or before the due date of the Maryland estate tax return at the following address:

Comptroller of Maryland Estate Tax Section
P.O. Box 828
Annapolis, MD 21404-0828

What is the Maryland estate tax rate?

According to the Maryland Comptroller's website, there is no Maryland estate tax rate table. Instead, the Maryland estate tax tax is calculated using the maximum allowable credit for state death taxes under §2011 of the Internal Revenue Code, as computed for Maryland purposes, less any Maryland inheritance tax paid to the Register of Wills. For decedents dying after December 31, 2005, the tax cannot exceed 16% of the amount by which the decedent’s taxable estate exceeds $1,000,000. If the Maryland inheritance tax is equal to or exceeds the federal credit for state death taxes, no Maryland estate tax is due.

For an explanation and tips on how to calculate the Maryland estate tax, refer to following information listed on the Comptroller of Maryland's website: Maryland Estate Tax Calculation Method.

Where can I find additional information about Maryland estate taxes?

For more information about Maryland estate taxes, refer to the Comptroller of Maryland's website: Maryland Estate and Inheritance Tax.

Call the Maryland Comptroller's Office with your Maryland estate tax questions at 410-260-7850 from Central Maryland or 1-800 MD TAXES from elsewhere, Monday - Friday, 8:00 a.m. - 5:00 p.m. EDT.

You can also e-mail your Maryland estate tax questions as well as fiduciary tax questions to taxhelp@comp.state.md.us. How have the Maryland estate tax laws changed over the past few years?

On May 22, 2012, Maryland Governor Martin O'Malley signed the "Family Farm Preservation Act" into law. This legislation, which was passed by unanimous votes in both the House and Senate, reduces the Maryland estate tax rate assessed against Maryland farms valued over $5 million from 16% down to 5% when the property passes to someone who agrees to continue to use it for agricultural purposes. If the property is then taken out of agricultural use within 10 years of the owner's death, the estate tax will be recaptured. The law went into effect on July 1, 2012 and applies to deaths occurring after December 31, 2011.

 

Overview of Illinois Estate Tax Laws

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Understanding How Illinois Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Illinois, then you live in one of a handful of states that still collect a state death tax. The estates of Illinois residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Illinois, are subject to a state death tax under the following guidelines.

NOTE: State laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

How have the Illinois estate tax rules changed in the past few years?

The Illinois estate tax rules have changed significantly in the past few years. In 2009, the Illinois estate tax exemption was $2,000,000. In 2010, the Illinois estate tax was repealed due to changes in the federal estate tax laws. In 2011, the Illinois legislature acted quickly to reinstate the state estate tax with a $2,000,000 exemption. Then, in December 2011, the Illinois legislature acted to raise the estate tax exemption to $3,500,000 for 2012 and $4,000,000 for 2013. The information presented below applies to deaths that occur in 2012 only.

When is an estate subject to the Illinois estate tax?

For Illinois residents, a 2012 estate may be subject to the Illinois estate tax if the total gross estate exceeds $3,500,000.

For nonresidents of Illinois, a 2012 estate may be subject to the Illinois estate tax if it includes real estate and/or tangible personal property having a situs within the state of Illinois and the gross estate exceeds $3,500,000. What Illinois estate tax forms must be filed?

The estate representative of a 2012 estate that is subject to the Illinois estate tax must file an Illinois Estate & Generation-Skipping Transfer Tax Return, Form 700, as well as a federal estate tax return, IRS Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return (or any other form containing the same information), even if the estate is not required to file IRS Form 706. IRS Form 706 must include all schedules, appraisals, wills, trusts, attachments, etc., as the federal Form 706 would have for a 2011 decedent with a tentative taxable estate plus adjusted taxable gifts over $2,000,000. The Illinois estate tax will then be determined using the inter-related calculation for 2012 decedents as discussed below.

Note that when the 2012 tentative taxable estate plus adjusted taxable gifts exceeds $5,120,000, Illinois Form 700 is to be prepared in the same manner for 2012 as for 2011, and must therefore include a copy of IRS Form 706 with all attachments.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, an Illinois death tax may be due on the B Trust after the first spouse's death due to the gap of $1,620,000 between the Illinois exemption of $3,500,000 and the federal exemption of $5,120,000. Nonetheless, a married decedent's estate can make an election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP" for short) for purposes of calculating the Illinois estate tax. Thus, married Illinois residents can defer payment of both Illinois and federal death taxes until after the death of the surviving spouse using ABC Trust planning.

When are the Illinois estate tax return and tax payment due?

The Illinois estate tax return must be filed, and any estate tax due must be paid, within nine months after the decedent's date of death.

An extension of time to file the Illinois estate tax return and related forms and pay any tax due may be requested; however, this will not extend the time to pay the tax, and interest will accrue during the extension period.

Where are the Illinois estate tax return filed and tax payment made?

For Cook, DuPage, Lake and McHenry Counties, file the original of the return with:

Office of the Attorney General Revenue Litigation Bureau
100 West Randolph Street
13th Floor
Chicago, Illinois 60601

For all other counties, file the original of the return with:

Office of the Attorney General Revenue Litigation Bureau
500 South Second Street
Springfield, Illinois 62706

Effective July 1, 2012, an additional copy of the return, without attachments, must also be filed with the State Treasurer as indicated below.

Effective July 1, 2012, all estate tax payments should be directed to one of the State Treasurer’s offices, which is encouraging people to mail the applicable returns, attachments, and payments to the Springfield office; however, taxes may be paid in person at either office indicated below:

By mail or in person:

Illinois State Treasurer Estate Tax Division
400 W. Monroe, Suite 401
Springfield, IL 62704

In person: Illinois State Treasurer
100 West Randolph Street
Suite 15-600
Chicago, IL 60601

How is the Illinois estate tax calculated?

The Illinois estate tax is determined using the inter-related calculation. For both resident and non-resident decedents, the tax base will be calculated assuming all assets are located within Illinois. (Line 6, Schedule A or B, Form 700). The percentage of Illinois assets to total assets is then computed with the percentage applied to the tax base for apportionment purposes to determine the amount of Illinois estate tax due.

For deaths that occurred on or after January 1, 2012, use the following calculator provided by the Illinois Attorney General's office to calculate the tax due: 2012 Decedent Estate Tax Calculator. Where can I find additional information about Illinois estate taxes?

For more information about Illinois estate taxes, including information for the estates of decedents who died in 2011 and prior years, refer to the Illinois Attorney General's Estate Tax webpage. For more information about estate tax payments, refer to the Illinois Treasurer's Inheritance Tax and Estate Tax webpage.

Overview of Hawaii Estate Tax Laws

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Understanding How Hawaii Estate Taxes Affect an Estate
By Julie Garber, About.com Guide

If you live in Hawaii, then you live in one of a handful of states that still collect a local death tax. The estates of Hawaii residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in Hawaii, are subject to a local death tax under the following guidelines.

NOTE: State and local laws change frequently and the following information may not reflect recent changes.  For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the Hawaii estate tax?

In 2013, an estate of a resident of Hawaii, or a nonresident of Hawaii but U.S. resident or citizen, is taxable in Hawaii and a Hawaii Estate Tax Return, Form M-6, is required to be filed if the taxable estate (determined using IRS Form 706, Part 2, line 3a) is $5,250,000 or greater. Nonetheless, if the decedent is survived by a spouse and the spouse is allowed to claim an election for transfer, or "portability," of the deceased spouse’s unused estate tax exclusion amount, then a Hawaii Estate Tax Return must be filed to make the election. See more on portability below.

The estate of a nonresident of the U.S., not a U.S. citizen, is taxable and a Hawaii Estate Tax Return is required to be filed if the taxable estate (determined using IRS Form 706-NA, Part II, line 1) is $60,000 or greater.

What Hawaii estate tax forms must be filed?

The personal representative or other fiduciary representing an estate that is subject to the Hawaii estate tax must complete and file the Hawaii Estate Tax Return, Form E-1.

Additional documents that must be filed with the Hawaii Department of Taxation when a Hawaii Estate Tax Return is required to filed are as follows: ◾IRS Form 706 (for the year of death) completed through Part 2, line 12, or IRS Form 706-NA completed through Part II, line 8 ◾All federal schedules with federal Forms 712, as required ◾Death certificate ◾Will ◾Trusts ◾Power of appointment documents ◾A copy of another state’s estate tax return or foreign estate tax return, if the estate is subject to other estate taxes ◾Any valuations or appraisals

Note that for estates that are not required to file a Hawaii Estate Tax Return, the personal representative or person(s) in possession, control, or custody of the decedent's property must file a Request for Release, Form M-6A, with the Department of Taxation if the agent wishes to obtain a release which indicates that the personal representative or person(s) in possession, control, or custody is/are free from taxes under chapter 236E, Hawaii Revised Statutes (HRS).

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, since the Hawaii estate tax exemption equals the federal estate tax exemption, a Hawaii death tax will not be due on the B Trust after the first spouse's death since there will not be a gap between the Hawaii exemption and the federal exemption.

Are transfers to a civil union partner taxable?

On January 1, 2012, civil unions became recognized in Hawaii. Civil unions entered into in a jurisdiction other than Hawaii are also recognized, provided that the relationship meets Hawaii’s eligibility requirements, has been entered into in accordance with the laws of the other jurisdiction, and can be documented. Hawaii law provides the Internal Revenue Code (IRC) sections and provisions referred to in Hawaii’s estate and generation-skipping transfer tax Laws that apply to a husband and wife, spouses, or person in a legal marital relationship will apply to partners in a civil union with the same force and effect as if they were “husband and wife”, “spouses”, or other terms that describe persons in a legal marital relationship.” Accordingly, references to “married”, “unmarried”, and “spouse” also means “in a civil union”, “not in a civil union”, and “civil union partner”, respectively.

Is portability of the Hawaii estate tax exception allowed between spouses?

Yes, but portability of Hawaii's estate tax exemption applies only to decedents who die after January 25, 2012 and who were U.S. residents or U.S. citizens and validly married on the date of death (including Hawaii civil unions or the equivalent) and to nonresidents of U.S., not U.S. citizens, where allowed by any applicable treaty obligation of the United States.

What is the Hawaii estate tax rate?

The Hawaii estate tax rate is a progressive one that starts out at 5% and tops out at 16%.

When are the Hawaii estate tax return and tax payment due?

The Hawaii Estate Tax Return, Form M-6, must be filed, and any estate tax due must be paid, within 9 months of the decedent's date of death. An extension of time to file the Hawaii Estate Tax Return does not extend the time to pay any tax due.

An extension to file the Hawaii Estate Tax Return, Form M-6, is based on the federal extension to file the federal estate tax return. Hawaii does not have a separate extension form, but an automatic six-month extension to file Form M-6 will be granted if: 1.A copy of the IRS approved extension to file the federal estate tax return, IRS Form 4768, is attached to Form M-6; and 2.Form M-6 is filed by the due date specified by the IRS for filing the federal estate tax return.

Where are the Hawaii estate tax return filed and tax payment made?

Mail all required forms and any payment due to:

Hawaii Department of Taxation
P.O. Box 259
Honolulu, Hawaii 96809-0259

Where can I find additional information about Hawaii estate taxes?

For more information about Hawaii estate taxes, refer to the Department of Taxation's website: Hawaii Department of Taxation.

You may call customer service at 808-587-4242 or toll free at 1-800-222-3229; Telephone for the Hearing Impaired at 808-587-1418 or toll free at 1-800-887-8974; or send a fax to 808-587-1488.

You may also email the department at Taxpayer.Services@hawaii.gov

Correspondence may be mailed to:

Taxpayer Services Branch
P.O. Box 259
Honolulu, HI 96809-0259

Does Hawaii collect an inheritance tax?

Does Hawaii collect a local inheritance tax, which is a tax assessed against the share received by each individual beneficiary of an estate as opposed to an estate tax, which is assessed against the entire estate? The answer to this question is No, Hawaii no longer collects a state inheritance tax because it was replaced with a state estate tax under "The Estate and Transfer Tax Reform Act of 1983."

Overview of District of Columbia Estate Tax Laws

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Understanding How DC Estate Taxes Affect an Estate

By Julie Garber, About.com Guide If you live in the District of Columbia, then you live in one of a handful of jurisdictions that still collect a local death tax. The estates of DC residents, as well as the estates of nonresidents who own real estate and/or tangible personal property located in DC, are subject to a local death tax under the following guidelines.

NOTE: State and local laws change frequently and the following information may not reflect recent changes. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

When is an estate subject to the DC estate tax?

For DC residents, an estate may be subject to the DC estate tax if the total gross estate exceeds $1,000,000.

For nonresidents of DC, an estate may be subject to the DC estate tax if it includes real estate and/or tangible personal property having a situs within the District of Columbia and the gross estate exceeds $1,000,000. Ads

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If the estate is not passing to a surviving spouse or being donated to charity and the estate is subject to the DC estate tax, then the estate representative must file a DC Estate Tax Return called Form D-76.

If the estate is passing to a surviving spouse or being donated to charity and the estate is subject to the DC estate tax, then the estate representative must file a DC Estate Tax Return called Form D-76EZ.

The following documents should be attached to DC Form D-76 or DC Form D-76EZ, if applicable:

A copy of Form FR-77 (Extension of Time to File DC Estate Tax Return)     A copy of the Letters of Administration     A copy of the Power of Attorney     A copy of the decedent's Last Will and Testament     A complete copy of IRS Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, including all attachments, if the estate is required to file IRS Form 706; OR, a current copy of pages 1-3 of IRS Form 706, if the estate is not required to IRS Form 706     A copy of all certified appraisals of the decedent's property and a copy of the Death Certificate.

Note that as indicated above, a DC Estate Tax Return may be required to be filed even if a federal estate tax return, IRS Form 706, is not required to be filed. In addition, even if the estate will not be required to file IRS Form 706, if a DC Estate Tax Return is required to be filed, then pages 1 - 3 of IRS Form 706 need to be prepared and filed with the DC Estate Tax Return.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce their federal estate tax bill, a DC death tax may be due on the B Trust after the first spouse's death due to the gap of $4,250,000 between the DC exemption of $1,000,000 and the federal exemption of $5,250,000. While some states allow a married decedent's estate to make an election to treat a trust of which the surviving spouse is the sole beneficiary as "qualified terminable interest property" ("QTIP" for short) for purposes of calculating the local estate tax, DC law does not specifically allow for this, although some practitioners have been able to do this. Thus, married DC residents should consult with a DC estate planning attorney to determine if they should incorporate ABC Trust planning into their estate plan.

When are the DC estate tax return and tax payment due?

The DC estate tax return must be filed, and any estate tax due must be paid, within 10 months after the decedent's date of death.

A six-month extension of time to file the DC estate tax return and related forms and pay any tax due may be requested; however, this will not extend the time to pay the tax, and interest will accrue during the extension period. Interest is charged at the rate of 10% per year, compounded daily and without regard to any extension.

All extension requests must be requested using DC Form FR-77; IRS Form 4768 will not be accepted. Where are the DC estate tax return filed and tax payment made?

Mail returns and payments to:

Office of Tax and Revenue Audit Division Estate Tax Unit
P.O. Box 556
Washington, DC, 20044-0556

Checks should be made payable to the "DC Treasurer."

How is the DC estate tax calculated?

The DC estate tax rate is a progressive tax that maxes out at 16% for estates valued at $10,040,000 or more. Use the Estate Tax Computation Worksheet to calculate the tax due.

Where can I find additional information about DC estate taxes?

For more information about DC estate taxes, refer to the DC Office of Tax and Revenue's Estate, Fiduciary, and Inheritance Taxes Frequently Asked Questions.

Does DC collect an inheritance tax?

Does the District of Columbia currently collect a local inheritance tax, which is a tax assessed against the share received by each individual beneficiary of an estate as opposed to an estate tax, which is assessed against the entire estate? The answer to this question is No, the District of Columbia inheritance tax was repealed effective for deaths occurring on or after April 1, 1987.

Connecticut Estate Tax Laws

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Connecticut, Land of Both Estate and Gift Taxes

NOTE: State laws change frequently and the following information may not reflect recent changes in the laws. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.

Connecticut residents, as well as nonresidents who own real estate and/or tangible personal property located in Connecticut, are subject to gift taxes and state estate taxes under the following guidelines.

What is the Connecticut taxable estate?

The Connecticut taxable estate is the sum of (1) the total value of the decedent’s federal gross estate less allowable deductions other than the deduction for state death taxes; and (2) the aggregate amount of Connecticut taxable gifts made by the decedent during his or her lifetime for all calendar years beginning on or after January 1, 2005.

When is an estate subject to the Connecticut estate tax?

If the Connecticut taxable estate as determined above exceeds $2,000,000, then Connecticut estate tax is due and payable on the value of the taxable estate, including the first $2,000,000. Note: For deaths occurring on or after January 1, 2010 and on or before December 31, 2010, the state estate tax exemption was increased from $2,000,000 to $3,500,000.

What Connecticut estate tax forms must be filed?

All estates subject to the Connecticut estate tax must file Form CT-706/709, Connecticut Estate and Gift Tax Return, with the Connecticut Department of Revenue Services, and also file a copy of Form CT-706/709 with the appropriate Connecticut probate court.

Are transfers to a surviving spouse taxable?

Outright transfers to a surviving spouse are not taxable.

For married couples who have used AB Trust planning to reduce federal estate taxes, Connecticut estate tax may be due on the B Trust after the first spouse's death. A married decedent's estate is authorized to make an election on Form CT-706/709 to treat property as marital deduction qualified terminable interest property ("QTIP") only for purposes of calculating the Connecticut estate tax (this is called a "state QTIP election"). What this means is that if the estate is passing to a surviving spouse through an ABC Trust scheme, then the payment of both Connecticut and federal estate taxes can be deferred until after the death of the surviving spouse.

Do Connecticut nontaxable estates have to file any tax forms?

If the sum of the Connecticut taxable estate is $2,000,000 or less for deaths occurring before January 1, 2010 or after January 1, 2011, or $3,500,000 for deaths occurring between January 1, 2010 and December 31, 2010, then no Connecticut estate and gift tax return will be due. However, all Connecticut estates must file Form CT-706 NT, Connecticut Estate Tax Return (For Nontaxable Estates), with the appropriate Connecticut district probate court. Do not file Form CT-706 NT with the Department of Revenue Services. Form CT-706 NT must be filed with the appropriate Connecticut district probate court.

When is the Connecticut estate tax return and any payment required due?

For deaths occurring before July 1, 2009, Form CT-706/709 for the Connecticut estate tax is due within nine months after the date of the decedent's death unless an extension of time to file is requested.

For deaths occurring on or after July 1, 2009, Form CT-706/709 for the Connecticut estate tax is due within six months after the date of the decedent's death unless an extension of time to file is requested.

Use Form CT-706/709 EXT, Application for Estate and Gift Tax Return Filing Extension and for Estate Tax Payment Extension, to apply for an extension of time to file.

Payment of the Connecticut estate tax is due at the same time as Form CT-706/709 unless an extension of time to pay has been granted.

Where is the Connecticut estate tax return filed?

Mail the Connecticut estate tax return, Form CT-706/709, and all other required forms to:

Department of Revenue Services
P.O. Box 2978
Hartford, CT 06104-2978

Do not mail your Connecticut nontaxable estate return, Form CT-706 NT, to the Department of Revenue Services. Instead, this form gets filed with the appropriate Connecticut district probate court. What is the Connecticut estate tax rate?

The Connecticut estate tax rate is a progressive one that starts with 5.085% of the first $100,000 over the $2,000,000 threshold and rises to 16% for the amount above $10,100,000.

Where can I get more information about Connecticut estate taxes?

For more information on Connecticut estate taxes, refer to Connecticut Estate Tax Resources From the Department of Revenue Website.

What about other states that collect estate taxes or inheritance taxes?

For information about other states that collect estate taxes, refer to the State Estate Tax and Exemption Chart.

For information about state inheritance taxes, which are different from state estate taxes, refer to the State Inheritance Tax Chart.

About.com

You’re Young; Do You Need an Estate Plan?

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While the trend these days is for people to live well into their 80s and 90s, I'm hearing more and more about the unexpected deaths of people in their 30s, 40s, and 50s. During my 15 years of practice I've met with my fair share of young widows or widowers or the parents of a child who died unexpectedly, and in all cases but one there wasn't any estate planning done. And even in the one estate where the deceased husband did have a will, it had been written while he was still single and lived in New Jersey and it hadn't been updated after the birth of his child, his second marriage, or even after the couple moved to Florida. What a mess that was to deal with and I hate to say this, but in the big picture the young family probably would have been better off without any will at all instead of an extremely old and out of date will. I can't emphasize enough how important it is for everyone, young and old alike, to have an estate plan. But as my example of the young husband who failed to update his will after major changes in his life demonstrates, that's really not enough. You also need to make sure that all of the important documents that are included in your estate plan - wills, trusts, powers of attorney, advance medical directives - are kept up to date and change as your family, finances, and the law change. This will require a yearly meeting with your estate planning attorney, but that's OK because you need to understand that estate planning is not a one shot deal but an ongoing process. And the time to start the process or continue the process is now.

In a 2004 survey conducted by Lawyers.com, the two most frequent reasons adult Americans cited for not having an estate plan were insufficient assets and not being old enough to need a plan. Sadly, those who hold these beliefs are greatly mistaken. With life's ups and downs comes the need for basic estate planning for both the young and old alike. Here are six estate planning tips for young singles and couples that can nonetheless be used by singles and couples of all ages.

1. Don't Rule Out a Prenuptial Agreement If you are young and do not think that you need a prenuptial agreement before getting married, think again. Many circumstances warrant at least considering a prenuptial agreement, including being involved in a family-owned business or owning your own business; having part of your paycheck stashed away in a 401(k) or other retirement plan; the possibility of inheriting assets from your family; owning a residence that will be used as the marital home; or marrying someone who has already accumulated a large amount of debt. A prenuptial agreement can protect what assets you currently have or significant assets that you expect to inherit, and can also protect you from your spouse-to-be's debts acquired before the marriage.

2. Make an Estate Plan for Medical Emergencies Twenty-six year old Terri Schiavo of Florida certainly did not anticipate slipping into a coma in 1990 and then having her husband and parents fight over her medical care and ultimate wishes for the next 15 years. Planning for medical emergencies is a must for everyone and should include the signing of two important legal documents called a Living Will and an Advance Medical Directive.

3. Make an Estate Plan for Financial Emergencies If you are out of the country on business and your spouse is at home trying to sell the house, or if you are in an accident and expected to fully recover but will be in the hospital for a while, then you will need a Durable Power of Attorney to allow your spouse or other person of your choice to manage your finances and sign legal documents on your behalf.

4. Make an Estate Plan for an Untimely Death Planning for an untimely death is important, particularly if you are in a committed relationship and/or have young children. If you fail to make an estate plan, then the state where you live at the time of your death will make one for you and in most situations the plan will not be what you would have wanted had you taken the time to make your own plan. Aside from this, assets titled in your individual name will need to be probated to transfer them into your beneficiaries' names after you die. Having at least a basic Last Will and Testament in place that puts someone in charge of settling your estate and names your preferred beneficiaries and a guardian for your minor children will give your loved ones peace of mind during a difficult time.

5. Make an Estate Plan for Your Minor Children Even if you do not think that you have enough money or property to need an estate plan, you will need to make a plan if you have minor children. If you do not, then control of the minor's inheritance will be taken over by a court-supervised guardian or conservator. Then, depending on the laws of the state where the minor lives, when the minor reaches the age of 18 or 21 all of the remaining guardianship funds will be turned over to the young adult, free and clear of any guidance or strings attached. Aside from this, if you and the other parent of your children both die while the children are still minors, then the children will become wards of the court until a judge can decide who the children should live with until they become adults.

6. Buy Term Life Insurance When you are young, term life insurance is really cheap and can offer your family financial security if you were to die prematurely. The insurance proceeds can be used for things such as paying off your outstanding medical and credit card bills; paying off your mortgage; replacing your lost income; paying for your children's care and education; and/or paying for a live in nanny, day care or after school care. Term life insurance is also easy to buy these days with services like Intelliquote, Quickquote and Reliaquote. Or, if you are offered term life insurance at work, buy it.

Everyone Needs an Estate Plan

Estate planning is not just for older or wealthy people. Younger people, especially those with minor children, need to have a will and estate plan in place in order to give instructions to their loved ones to follow in the event of a debilitating accident or untimely death. Celebrities like Heath Ledger, Anna Nicole Smith (also known as Vickie Lynn Marshall), Princess Diana, John F. Kennedy, Jr., Janis Joplin, Michael Jackson, and, most recently, Brittany Murphy, all died unexpectedly, and yet each and every one of them had a will and estate plan. It's just common sense.

Julie's Wills & Estate Planning Blog

Unintentionally Disinheriting Your Children- It’s Easier than You Think

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One of the strange outcomes of sloppy estate planning work is the case of unintentionally disinherited children.  Obviously this isn't something that most of us want to do, as you can ask 100 parents off of the streets whom they want to inherit their estate and all but a handful would answer, "My kids."  Unfortunately, many estate plans fail to accommodate this simple wish.

How Disinheritance Happens

The most common way that an unintentional disinheritance occurs is responsible parents draft what is referred to as an 'I love you will'.  This is a simple will that essentially says that when one spouse dies, the other will inherit the estate.  When the second spouse dies, the estate will then go to the children.  Sounds reasonable enough, right?

This is all well and good as long as neither spouse remarries after the other dies.  However, many spouses will remarry and draft another 'I love you will', and this creates a major problem.  In this second will, children from the first marriage are left out in the cold, as when the second parent dies, the entire estate is passed on to the second spouse and not the children.  At that point, it is entirely up to the second spouse as to whether or not the kids will see any money.

Since it is a second marriage, the odds of animosity towards the second marital partner are significantly higher.  This means that the chances of an unintentional disinheritance are much greater.  To solidify this concept, let's use a hypothetical example.

Example:  Matt and Lisa and Jeff

Matt and Lisa were married at the age of 25 and had two children - Jake and Anna.  Being responsible parents, Matt and Lisa drafted a simple will that would pass the estate on to the surviving spouse and then on to the kids.  Unfortunately, Matt had a heart attack at the age of 42 and died.  Lisa inherited the estate and life insurance proceeds.

Lisa, also 42, began dating a couple of years later and fell in love with Jeff.

After dating for two years, they tied the knot at the age of 46.  Being responsible adults, they updated their estate plan to reflect their recent marriage and put together another 'I love you will'.  Their marriage was strong and everyone was happy.

Shortly after Lisa's 67th birthday, she died.  Her estate plan that was drafted more than 20 years earlier was reviewed and executed.  Jeff inherited the estate and Lisa's children received nothing.  Feeling this wasn't right, Lisa's children, Jake and Anna, contested the will to no avail.

This created animosity and Jeff decided to draw up a new will that eliminated Jake and Anna as beneficiaries.  And there you have it:  an unintentional disinheritance.

Wrapping Up

In this post, we examined the concept of an unintentional disinheritance and how it happens.  If you wish to avoid having something like this occur, there are a number of ways to do so that can be as complicated as drafting a trust with QTIP provisions to simply updating your will based on changing needs.  We will explore these solutions in upcoming articles, but for now, it is important that you recognize this problem exists - particularly if you're already remarried with children.

 

Top 5 Estate Planning Mistakes

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I recently read a report that suggested that only about 20 percent of the population has a formal estate plan. After reviewing the points below, please take a minute to consider whether it's time for you to create or update your estate plan.

Here are five estate planning mistakes that people make that can be avoided.

1. Dying without a will or trust - If you die without a will or trust, the state in which you reside and the IRS will simply make one for you.  Of course, they have no interest in avoiding or reducing estate taxes, minimizing estate administration costs or protecting your family and legacy. The distribution of your assets will just be turned over to the Probate Court. The probate process is needlessly time consuming, frustrating and expensive. It is also open to the public, meaning creditors, predators or anyone else will have complete access to all information about your estate. For the vast majority of people, the benefits far outweigh any initial costs.

2. Having an "I love you" will – An”I love you” will is one in which all the decedent's assets have been left to the spouse. On paper, it might seem to be a caring, thoughtful gesture, but the reality is quite different, because such a will simply passes the complex issues and problems associated with transferring and protecting wealth onto the spouse or other loved ones.  It creates more problems than it solves, particularly for future generations.

3. Giving property outright to your children - Here is another solution that might sound good at first, but ignores several important realities. For instance, what if the child in question is too immature to handle the responsibility of a large sum of money on his or her own? What if the child suffers a severe financial setback that puts the inheritance at risk to creditors?  What if the child marries a fortune-hunter, is addicted to drugs or alcohol, gets divorced or remarried? You may need to protect your children and heirs from their own poor decisions.  These assets are also gifted assets which carry potentially large IRS penalties if not handled properly.

4. Owning property jointly - There are two types of joint ownership, Joint Tenancy with Right of Survivorship (JTWROS) and Tenants in Common (TIC).  Problems with JTWROS include postponement of probate only until last tenancy, the loss of the double step-up in tax basis creating more to pay in capital gains taxes, and outright distribution.  With TIC, you also lose the double step-up in tax basis where it's available, and your property is subject to the estate plan of each tenant as well as probate for each tenant.

5. Not having a trust - A trust is the single most effective estate planning tool available. There are many different types of trusts.  Among the better known and more commonly used are revocable trusts, irrevocable trusts and testamentary trusts. A Trust protects your privacy, and will help you leave what you want, to whom you want, in the way you want at the lowest possible cost overall.  The additional advantage is that you avoid Probate altogether, which means that the settlement of the living trust will be done swiftly, without court or attorney's involvement, in contrast to having only an "I love you" Will.

Retirement Accounts – Who is the Beneficiary of Your Account?

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Have you checked your beneficiary designation for your retirement account recently? If not, you may find that your designated beneficiary is not who or what you think it should be, especially if you have divorced, remarried or had children since your retirement plan account was established.

Outdated Beneficiary Designations

There have been numerous cases of retirement-account owners who have been divorced and remarried but have neglected to update their beneficiary designations accordingly. This can be quite frustrating for their survivors, who must battle in court for a legal determination of the true beneficiary. The court's decision, however, may not necessarily be what the deceased would have wanted.

A similar dilemma arises if children are named as beneficiaries but the document has not been updated to include those who were born after you set up your account. To prevent these situations, you should update your beneficiary designation periodically or even immediately after you experience a change in family status. Should you need to, you may submit a change-of-beneficiary form.

Per Stirpes Designations

In the event your child predeceases you, a per stirpes beneficiary designation would allocate that share to the child's issue – your grandchildren.  If you don't name them, they will be disinherited from taking the share of their parent.

Make Provisions for Simultaneous Death

Many spouses, expecting that one will predecease the other, name each other as their designated beneficiaries. The issue of simultaneous death is then addressed by state law, which will determine that one spouse died first, even though both deaths occurred at the same time. This determination is critical, especially if there are children from a previous marriage: will all the children be included? Or will children from a previous marriage be excluded? Proper documentation designating successor beneficiaries for normal and extenuating circumstances will ensure that the retirement-account owner decides who the successor beneficiary is.

Look into a Trust for Your Distributions

If you feel you need to retain some degree of control over the disposition of the retirement assets after your death, you may consider designating a trust as your beneficiary. Designating the right type of trust as your beneficiary could offer these benefits:  allow you to provide financial support for your surviving spouse while ensuring that children from previous marriages are also provided for; helping to maximize your estate tax exclusions; and controlling distributions to the children you might think are not mature enough to handle a large IRA. Trusts require expertise to set up correctly, so please ask me for some assistance before you make any decisions regarding customized and/or trust beneficiary designations.

Beneficiary Designation Checklist

Check the default provisions of the document that governs your retirement account, as it may come into effect if your beneficiary predeceases you and you fail to make subsequent changes.

Look into the tax implications for the kind of beneficiary you choose, whether a particular person, such as a spouse or non-spouse, an entity, such as a charity, your estate or a type of trust.

Request a confirmation of receipt of the designation from your retirement account trustee, custodian or administrator. Documents do not always reach their intended recipient and/or may get lost in transit. Beneficiary designations are considered in effect only if they are received by the responsible party (e.g. trustee, custodian or administrator) before the retirement account owner dies.

If you prefer to use a customized beneficiary designation, make sure your trustee, custodian or administrator finds it acceptable. Not all financial institutions or qualified plans will accept customized beneficiary designations.

Check with your financial institution periodically to determine who your beneficiary is - you may need to make changes if you had a change in your family such as a birth, death, divorce or marriage.

Making a proper beneficiary designation is a very important part of your financial planning process.

Document Solutions

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Comprehensive Estate Planning Documents - Revocable Living Trusts - Will Package - Ancillary Documents

What Gives Our Documents the Leading Edge?

Detailed and comprehensive, these documents have been developed through nearly 30 years of hands-on improvement by hundreds of attorneys throughout the US resulting in thousands of satisfied clients. They are drafted to ensure accuracy with current state and federal laws, and are updated as changes occur.

The Revocable Living Trust contains over 222 carefully worded provisions so that the trust can accommodate a client’s changing circumstances and to cover additional contingent situations without needing to be legally modified.  The trust is also universal; that is applicable in all 50 states, for a client may eventually own property in or even move to another state.

I Would Like an Advisor to Contact Me to Discuss My Estate Planning Needs

Here is a list of what our package includes:

  • 1 set of Ancillary Documents per person (DPOA for assets, DPOA for healthcare or Advanced Directive, Living Will, Nomination of Conservator, Appointment of Guardian, and Anatomical Gift)
  • Abstract of Trust
  • Trust Certification
  • Pour-Over Will
  • Assignment of Furnishings and Personal Effects
  • 1 three-ring professional quality binder with tabs and inserts
  • 1 set of quality documents with Plain English summaries
  • Funding Manual

We offer a wide variety of estate planning solutions and documents customized at your direction.

Nationally Transportable Living Trusts

Single A Trust
Married A Trust
Married/Unmarried AB Trust
Married ABC Trust
A Q-TIP Trust (for married person)
Partner AA Trust
Partner AB Secure Trust (for Domestic Partners)
Complete Amendment
Partial Amendment

Vital Ancillary Documents

There are a number of other legal documents that are not legally required parts of the Living Trust but which should be included in or with the Trust to provide for future contingencies. Our ancillary documents offer you additional control over your person or assets. These documents are so vital; they are included, at no additional charge as part of your comprehensive document package.

Pour-Over Will
Living Will
Durable Power Of Attorney For Health Care
Durable Power Of Attorney For Assets
Nomination Of Conservator/Guardian
Appointment Of Guardian
Anatomical Gift

Advanced Planning Vehicles

Because many individuals have needs that go beyond basic estate planning, we offer numerous Advanced Estate Planning Solutions that can be incorporated into your overall estate plan. These documents should be considered as a supplement to your Living Trust to shelter your hard-earned estate from unnecessary estate taxes.

■Asset Management Trust (Spendthrift Trust)
■Beneficiary Trust (Dynasty)
■Buy/Sell Agreement
■Catastrophic Illness Trust (Medicaid Planning Trust)
■Charitable Remainder Trust
■Family Catastrophic Illness Trust
■Gift Trust
■Insurance Preservation Trust- Spousal Support (ILIT)
■Insurance Preservation Trust (ILIT)
■IRA/Qualified Plan Trust
■Land Trust
■Special Needs

“A POORLY WRITTEN TRUST IS WORSE THAN NO TRUST AT ALL.” Henry Abts, III

A poorly drawn trust can become a restrictive nightmare for the surviving spouse or successor trustee and beneficiaries. As long as the clients are living, it does not matter what a Living Trust says, because it can always be revoked. However, upon the death of the client, these poorly written Trusts are going to end up in probate court, with petitions being presented to revise or clarify the Trust wording. (Even though the main advantage of a Living Trust is to avoid probate, a Trust falls under the legal jurisdiction of the probate code; any need for clarification of a Trust therefore must be handled in the probate courts.)

One size does not fit all – no two people or families are alike! Your family’s needs, dynamics, personalities, and values are unique. If you use a form kit, you are asking for problems. Even LegalZoom.com reveals that 80% of people who fill in blank forms to create legal documents do so incorrectly. Plus, if your Will or Living Trust is not executed properly, it becomes invalid. If you overlook the opportunity to write specific instructions about how you want to provide for your spouse and children, your family will receive whatever the “cookie cutter” document provides, and you may not know of other options. The only estate plan you rely on is the one that is custom prepared by a qualified estate planning professional attorney.

A well-written comprehensive trust document comes about only through extensive experience. The Estate Planning Source’s trust documents are the result of more than 28 years of working together with legal counsel to cover every imaginable contingency.

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