Death Tax Questions
What is death tax?Death tax is a type of tax that is levied on the estate or inheritance of a person who recently passed away. Death tax is known by many different names, but the most common ones are inheritance tax and estate tax. When a family member or friend passes away, often the surviving family members/friends are left with taking care of the deceased persons assets and many times will need Expert advice on how to handle tough situations. Read below where Experts have given answers and insight on many tough death tax law situations.
Is death tax exempt only in the year 2010 or has it been in force since the tax cuts president Bush made?In the year 2010, death tax is entirely exempt and it is the only year it has been entirely exempt. In the year 2001, during President Bush’s tax cuts, the law went into effect that gradually increased the amount of value that an estate had to be worth before the death tax went into effect. In the year of 2001, the exclusion amount that the estate had to be was $675,000 and in 2009 the amount was three point five million. In the year 2010, there is no death tax, but in the year 2011 the exclusion amount will be reset to one million dollars. Any estate that is over the one million dollar exemption will have to file form 706 tax return and pay the taxes according to that.
In the state of Colorado, what is the death tax percentage if the estate is $325,000 in cash for the year 2010?In the year 2010, there is no death tax. The death tax rate is tied to the federal guidelines and since the current 2010 federal has no tax implications the state cannot pursue the estate for any kind of taxes.
In the state of Kansas, if a parent dies and leaves their children their estate, what all is included in the death taxes?In the state of Kansas, the state does not impose any death tax on an estate that is below $5.1 million. When the taxes are figured, the person would have to figure out what the value of the estate is and to figure the value of the estate the person would need to add up the value of all land, insurance, bank accounts, and any other property. These values are based upon the date of the person’s death or in some cases 6 months after the date of death.
In the state of California, if a grandparent chooses to give their grandchild a gift of money, is this gift taxable or does it have to stay under the $13,000 limit to not have to pay taxes?The state of California does not impose a state death tax or state gift tax; therefore the person can make a gift and not have to pay tax on it. The annual $13,000 is still in effect for each donor and if the money pays tuition or medical bills, then the amounts would be tax free as well.
When a person dies, there may be taxes that they have to pay unless the taxes fall under the exclusions that are set forth. When it comes to death tax, there are several things that are considered when making the decision on how much an estate is worth and how much death tax, if any, will be charged to these estates. When these questions arise, then the person would need to consult an Expert to gain the insight into death tax.