my step mother Gloria, cousin Chuck Williams, Me, Dad, Bill Williams, my sister's Billee and Donna
This picture was taken in 2002, four years before my dad fell, hit his head and died after two brain surgery's to reduce the pressure on his brain. While in intensive care the surgeon told the family he was bleeding in the center of his brain. He lived for a week unconscious before dying. I'll never forget the phone call from my brother Preston, telling me "Dad's gone."
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| My dad at 51, and me during the filming of Goodbye Norma Jean in 1974. He was in his prime and he had a Living Trust. |
It's bad enough going thorough the trauma of losing a parent, but having to deal with his estate, has been a 10 year nightmare. It still isn't settled after years of fighting a lawsuit and the economic downturn. The year he died, 2006, the Death Tax was around $2,000,000. meaning anything over that was taxed 55%. Today if a person dies and leaves an estate under $5,430,000 there is no Death Tax.
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| My Dad in his late 60s, still robust and productive. He had a Living Trust. |
If my Dad hadn't had a living trust and a good Tax Attorney and Accountant the nightmare after his death, would have been unbearable. If you are considering a Living Trust do it now. I have one and have had it for over 10 years. I wouldn't want anyone to ever face Probate. I think you might be interested in seeing how an Estate Tax would impact your family today.
What is Estate Tax and how does it Impact Me?
All forms of property, irrespective the format of ownership,
that an individual owns at the time of their death is subject to federal estate
tax. This tax is then payable through your estate. Normally, it
will be paid by the decedent’s estate before the distribution of properties to
the estate’s beneficiaries. Estate taxes are due, barring an extension, within
a period of nine months of the individual’s death.
Exclusions on Estate
Tax
Though the majority of the decedent’s assets will be
included within the gross estate, occasionally there are exclusions. If the
property is left outright to a spouse, then the federal tax liability is nil.
It is a scenario referred to as marital deduction.
Should the decedent leave property to a charity that is
tax-exempt, there will be no tax.
The Payment of Estate
Taxes
Most Americans will not be subjected to federal estate
taxes. As a matter of fact, it’s a tax that only impacts the wealthiest of
Americans in most (but not all) states. For a death that has occurred during 2015, the exemption on
federal tax has been set at $5,430,000, per person. If you exceed that amount, then a 40 percent
tax levy is applied.
How to make a
Calculation and File
The calculation of federal estate tax is potentially a
complex matter. As such, it is thoroughly advisable to utilize the services of
an estate tax attorney or other tax professional to receive help. An attorney
who works in the practice of estate planning will be able to help you through
the process, keep you updated as to any new laws, and also complete all the
filing matters for you.
Nevertheless, if you are not quite ready to engage the
services of an attorney just yet, and you merely wish to gain some concept as
to the amount you could owe, you may utilize an estate tax
calculator online. These can afford a reasonably good idea as to how much
you will owe.
To use an online calculator, you will require as much
information as you can garner with respect to cash and retirement accounts,
investment accounts, vested stock options, life insurance proceeds, your home’s
value, vehicles, together with any other assets. You will also need to know
about your liabilities, unused exemptions of federal estate tax, charitable
bequests, and taxable gifts.
You may wish to file on your own, in which case, you should
use IRS
Form 706. During the preparation of the return, do remember that you must
file for an estate’s gross value rather than net value over and above the
estate tax amount of exemption.
The return is due within nine months of death. Should you
require more time, it is possible to pay an estimated tax prior to the due
date, after which, you must file for an extension of six months. If you need
help with filing, read through the IRS’s Publication 950.
Estate Taxes for the
State
There may be no federal estate tax owed by an estate, but
there are 15 states together with the District of Columbia that do levy their
own taxes, and an individual does not have to be super wealthy to have to pay.
Currently, as of 2015, the following states are included:
Rhode Island, New Jersey, Maryland, Maine, Minnesota, Massachusetts, Oregon,
New York, Washington, Vermont, Delaware, Connecticut Tennessee, and Hawaii.
When will an Estate
be Subjected to Federal Estate Tax?
With the death of an individual, an estate will become a
taxable entity. Prior to the calculation of the tax, your real property,
gross estate of money, and any other assets whereby you had some form of
interest at the time of death, minus marital and charitable deductions, in
addition to administration expenses of the estate, together with other
acceptable deductions, will be tallied by the IRS to assess your net taxable
estate.
If the taxable estate is to exceed the decedent’s exemption,
federal tax is then payable. In 2015, the amount of exemption is $5.43 million.
However, if you are married, your spouse has a separate exemption entitlement
of a further $5.43 million.
The IRS closely scrutinizes the assets that are included in
the estate as well as the worth of each item. This can and frequently does
become the source of frustration between an estate and the IRS.
Here is the building he lived in while in Chicago. It is a masterpiece of Art Deco design and influenced the remodel at the Villa Valentino in 1938.
