All You Need to Know About Estate Planning and Tax Consequences

One common aspect of estate planning for everyone, however, is the need to consider the potential tax consequences of estate planning. Both the estate tax and / or gift tax may reduce the assets in your real estate as much as 55 percent without careful planning ahead of time. A basic understanding of how the estate and gift tax operates can help you see the need for a thorough estate planning.

Estate Tax: When you die, your estate assets should be inventoried and assessed as of the date of death. The total amount of all assets then potentially taxable real estate. Your estate can take advantage of the current exemption amount that applies to all plantations. Total exemption fluctuates every year. You can hire Mesa estate planning attorney through various online sources.

Image Source: Google

Gift Tax: In the event you think that gifting your estate assets prior to death may be the answer to avoid estate taxes, think again. Gifts are also taxed if they are above the lifetime exemption amount. This amount, such as estate and tax rates exemption amount, is also subject to change on an annual basis as federal tax law changes.

Gift tax rate is historically between 35 and 55 percent of the lifetime exemption amount of approximately $ 1 million. The number was much higher for 2012. The prize does not qualify for the annual exclusion or lifetime exemption will be taxed at the current gift tax rate.

There is no way of helping themselves trusts available in book form or a website or even a non-lawyer called a living trust mill will contain up to date the provisions of tax planning is crucial that you will get the comprehensive plan prepared by a lawyer who is experienced and qualified.