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Estate Taxes Take a Real Bite Out of Your Dollar

20th June 2011
By Adrian Cross in Taxes
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The children gain twice as much joy from the receiving. They will be honoured and proud that their parents left a sizable legacy to a worthwhile charity. The only one who gets left out is the Tax Man at Canada Revenue Agency. Somehow most people aren't real broken up that they cut the Government out of their will. The government is happy too since they don't have to fund charities. They don't decide which charities survive and which don't. Now you do the deciding through your financial planning. They gave you the tax breaks so now you have that control. Tax planning at its best.

Nearly a year has gone by since candidate Obama's campaign promises were initially voiced regarding the estate tax. But despite the procrastination of our elected leaders, a version of the estate tax will likely be still in place next year, although the sort of permanency that estate planners might have wished for may remain elusive. So despite the fact that uncertainties exist and are likely to linger, it's not the time to "sit on the fence" when planning your estate. Contact your elder law attorney or estate planner at your earliest opportunity to review your personal situation.

Motives - proper or not - may be associated with contribution money to their election campaigns from special interest groups who seek influence on how the laws should be changed. Laws that require imminent action frantically draw special interests to donate that much more. The more congress can keep the carrot dangling, the more campaign contributions which may be forthcoming. Clearly, congress has created this circumstance by their own inaction.

If you do live in a state that was listed, the amount of tax you will be charged will depend on the laws on the books of your particular state. It is a good idea to seek professional advice so you pay the right amount and do not find yourself in trouble down the road.

There are taxes and then there are TAXES! The coming estate tax definitely is going to be a big one that will make you shake your head. This is because the "death tax" has always been one of the largest we have in the internal revenue code. You must address it if you hope to leave your assets to heirs instead of Uncle Sam.

With mere weeks prior to the expiration of the estate tax on January 1, 2010, attorneys involved in estate tax planning, not to mention their clients, are on pins and needles wondering what will happen next. While our representatives in Washington are preoccupied with a host of momentous issues, it still seems possible that at least some resolution of the estate tax will be reached. But what has actually been decided?

The additional tax benefit of the bypass trust is that holdings that it shelters will continue to grow while the second-to-die remains alive. Those holdings are permanently outside the estate taxation at the time of her death. That's an important tax-sheltering purpose.

In 1976, taxes on estate and gift taxes were unified into a single system and remained unified even today. The accumulated taxable gifts made by an individual during his life were liable for the calculation of gift taxes. Taxes on estate taxes were calculated on the decedent taxable estate at death, reduced by gift taxes paid post -1976.

The Republicans may have stormed back into control of the House of Representatives, but that doesn't mean much in relation to the estate tax that is expected to be revived at the end of the year. The question is how you should deal with the looming monster tax.
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The Unseen Battle Over Estate Taxes. Visit IRS Tax Attorney. Worried About Estate Taxes. Visit Tax Lawyer.
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