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A good estate plan gives the maximum amount allowed by law to your beneficiaries and the minimum required to the IRS. In December of 2010, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act (TRUIRJCA) of 2010. In essence, the TRUIRJCA restored the federal estate tax according to the following conditions: for the 2011 tax year, a $5 million estate tax exemption was created while for 2012, the $5 million estate tax exemption was adjusted for inflation. As a result, the total 2012 estate tax exemption is equal to $5,120,000.
Practically speaking, this means that under the TRUIRJCA, estates will be taxed at a rate of 35% on any assets over and above $5.12 million. Since the Gift Tax Credit has not been as large as the Estate Tax Credit, failure on the part of an estate lawyer, or trustee to plan effectively for estate tax may be grounds for litigation.
Call Leeds Brown Law, P.C. at 1-800-585-4658 today to learn more about our estate litigation practice.
If you believe mismanagement and poor estate tax planning has resulted in financial harm to your inheritance or estate, contact New York estate litigation attorney Lenard Leeds today. Mr. Leeds has successfully represented hundreds of clients and participated in high-profile cases in New York and throughout the country.
Your Estate and the IRS
In deciding what your estate is worth, the IRS generally uses the fair market value of property you own at your death. In many cases, especially if you’ve owned a home, stocks or other assets for many years, the appreciation of assets could put you over the limit. Assets subject to tax at death include your home, the family farm, life insurance, household furnishings, benefits under employee benefit plans and other items that produce no lifetime income. Thus, you may be more wealthy than you realize.
The federal estate tax rate begins at 37 percent and may go as high as 55 percent. Some states charge an additional estate tax similar to tax imposed by the federal government; other states impose an inheritance tax. (Inheritance taxes are charged to beneficiaries; estate taxes are charged to the deceased person’s estate.)
The New York estate tax attorneys of Leeds Brown Law, P.C. can advise you whether federal and state estate taxes may be imposed on your estate. They advise clients in Carle Place, Old Westbury, Great Neck, Roslyn Heights and Syosset. Call us at 1-800-858-4658 or 1-516-873-9550.