Families who lose a loved one are often grieving immediately following death. Unfortunately, as they go through the different stages after someone’s passing, they endure numerous legal battles that prevent them from getting the inheritances that they deserve. Estate tax exists , meaning that some family members may lose a portion of the assets their loved one decides to leave for them. Working with a lawyer can help you with estate tax protection in the most effective way possible.
New York and New Jersey are two of 12 states that impose an estate tax. The estate tax is determined based on the estate’s overall value. This means that everything the decedent owns is calculated, and if the total equals more than the state limit, the estate tax comes into play. The estate would essentially pay the tax out of its total value. Luckily, if you are going through estate planning, you can include specific things that help your loved ones avoid estate tax. Our team at The Law Office of Nicole Israel, PLLC is here to help you!
How Can I Protect My Family from Estate Tax?
Estate planning has two basic types of trusts to consider. The first is the most common: a revocable trust. The person who creates the trust is the trustee and they can make changes and undo the trust whenever they want. While the trustmaker would make the trust the owner of the assets, the trustee can make changes at any time to remove property, put it in, change beneficiaries, or get rid of it completely. As the most common type of trust, a revocable trust does nothing to help avoid estate taxes.
However, an irrevocable trust can help avoid estate taxes. With an irrevocable trust, the person who creates the trust must step aside once it’s completed. They cannot maintain control of the assets within the trust; rather, they must decide on someone else to be the trustee. As the trustmaker is no longer owner of the property, the assets won’t be included in the estate and are thus ineligible for estate taxes.
There are a few deductions to consider, as well, including:
Estate Tax Rates
If you believe your assets are enough to make your estate eligible to be taxed, there are various rates that can impact how much may come out of your estate. Rates can range from 3.06% to 16%. However, it’s dependent on the value and size of the estate. The more assets you have and the higher the value, the more the estate will owe, so estate tax protection if your friend.
Why? Because, unfortunately, this is money that comes out of the estate before it is distributed amongst your beneficiaries. It can lower how much you intended your loved ones to receive, so it’s vital to take steps that help protect your estate from state taxes upon your passing.
Get estate tax protection: Working with an Estate Planning Lawyer to Safeguard Your Assets
While you can try to designate beneficiaries and asset distribution on your own, it is never a bad idea to get legal counsel on your side. A lawyer can look at your assets, determine if your estate would be eligible for estate tax, and explain your options to protect your loved ones from having to endure a difficult situation. The more assets you have, the more you should consider your options for estate tax protection . Working with a lawyer can also help you identify the current rates for the year.
The Law Office of Nicole Israel, PLLC is here to help you move forward. Your loved ones should be able to receive assets as the rightful beneficiaries. Estate tax can change how much your beneficiaries may receive, so be sure to speak with our estate planning attorney about how you can properly plan legal documents for yourself, your assets, and your family. We will be sure to provide you with comprehensive and personalized services that focus on your wishes. trust us to be there to safeguard your estate for your loved ones.
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