Many taxpayers don’t really understand how estate taxes work or whether they — or their heirs — will ever be affected by them. The reality is that most estates won’t be subject to an estate tax even though some states (though not Florida) and the federal government assess them. With the recent changes to the federal tax code, only estates valued at $11.4 million or more must pay federal estate taxes.
Valuating estates can be complicated, however, especially if you own a business, have stocks, bonds and other investments or have made large gifts to your children. If you think your assets are potentially close to the $11.4 million threshold, an experienced estate planning attorney can advise what assets may be considered part of your estate upon your death. Items you co-own with a spouse are taxed at 50 percent, but the remainder will be taxed upon your spouse’s death. A skilled estate planning attorney can also consult with tax experts and others to craft creative solutions to minimize taxes and maximize wealth preservation.
The real property you own will also affect potential tax liability upon your death. If you moved to Florida and still have another residence in another state, you may want to make Florida your primary residence because the state imposes no income or estate tax. To do so, you must spend the majority of your time living here, and you may have to make other changes in your former state to officially change your permanent residence status. If you own property in another state, you may still be subject to that state’s estate tax, regardless of first- or second-home status. Consult an estate planning attorney to find out whether changing your residence is possible or advisable.
Bankier, Arlen & Snelling Law Group, PLLC attorneys have years of experience advising clients of all income levels on tax and estate planning matters. To meet with one of our knowledgeable attorneys, call us at 561-278-3110 or contact us online.