Levins & Associates, L.L.C.

Schedule a Free Consultation

Fort Myers 239-344-9471

Toll Free 888-312-0536

What should you know about estate taxes?

After being appointed the executor of an estate, you may have questions about handling the taxes involved. The Internal Revenue Service says that an estate tax return depends on the value of the estate. This is determined by the gross estate, which includes all of the assets of the deceased.

While an estate is taxed for items such as real estate and cash, other assets are left out. This means that assets that the deceased did not control are not taxed. These include life estates and lifetime gifts. You will usually need to file an estate tax return if you choose to transfer some of the deceased’s nontaxable assets to a surviving spouse. Additionally, when the filing threshold is lower than the sum of the assets, an estate tax return is required. An estate tax may be decreased through expenses related to the management and settling of the estate or through charitable donations.

Preparing an estate tax return may take longer than you envisioned. When you realize you need more time to file the required taxes, an extension is available. Taxes are still owed by the deadline but you may receive another six months to pull the necessary information together. When you send in the tax return, the requisite documents are different from what you would need when filing your own taxes. You usually need to include appraisals of various assets and copies of the will and death certificate. Additionally, any legal proceedings need to be sent in as well.

After you send in the estate tax return, you may receive a closing letter from the IRS. This is usually mailed to you. Because the tax return will take time to process, you may have to wait four months or more to receive this letter. Typically, a closing letter is not sent to the executor unless you request one.

This information is general in nature. Because the details of estate taxes vary depending on specific circumstances, it should not be interpreted as legal advice.

Source: Internal Revenue Service, “Frequently Asked Questions on Estate Taxes,” accessed Sep. 27, 2016

No Comments

Leave a comment
Comment Information