How To Manage Estate And Inheritance Taxes

Estate Taxes are a tax on the estate, and can be imposed by the Federal Government. Inheritance Tax is paid by the inheritor, and is levied by the State Government. Inheritance tax varies from State to State, but estate tax does not.

Only the remaining portion of the estate can subsequently be distributed as per the will. In the event, the estate left is insufficient to cover the estate tax, then the resources left behind must first be offered to pay the taxes, and just then the balance could be distributed among the beneficiaries.

The liability for paying the estate tax is the responsibility of the executor named in the will. The executor can also be responsible for seeing that the property, or what remains of it, belongs to the right beneficiary. Here’s the online source to get information on Wealth Planning, advice on reducing Inheritance Tax:  Thornton & Baines | Estate Planners and Inheritance Tax Planners

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In some states, there is absolutely no tax. Where the tax is imposed, there are some concessions to the beneficiaries that are often related to the level of connection with the beneficiary to the deceased.

Estate duty and inheritance tax becomes complicated depending on the manner in which the will has been drawn up. When there is complexity involved, it’s far better to consult an authority in the subject, or a financial planner.

This is advisable since each state has its own guidelines on inheritance taxation, it can get quite cumbersome when the inheritors are located in various states. The help of a financial advisory service, experienced in such matters, would then become mandatory.

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