Tax Day is right around the corner! Be sure to get your tax returns squared away before the 18th. On the topic of taxes, we wanted to take the opportunity to discuss estate tax returns and what you may need to know if a loved one has recently passed away.
The estate tax is a transfer tax on the value of the original owner’s estate before distribution to any beneficiary. Estate tax returns should be filed within 9 months of the date someone passes away. A six-month extension may be granted if it is requested before the deadline; however, in most cases, an estimated tax should be paid along with the extension request. This tax return must be filed by a personal representative of the estate or anyone in possession of the deceased loved one’s property. A personal representative may include an executor, administrator, special administrator, special personal representative, or successor personal representative. The return can be filed online or by mail. For the estates of those who have passed away in 2006 or later, the applicable exclusion amount is $1,000,000.
Like other tax returns, the preparation and filing of an estate tax return requires a substantial amount of financial information, as the value of every single asset that the person owned as of their date of death must be listed. This requires both figuring out what all the assets are as well as tracking down the value of each for the specific date of death. The significant challenges presented by trying to figure out someone’s assets after they die is one of the many reasons that we here at Family Estate Planning Law Group practice with a client care program where we routinely track and update the spreadsheet of assets that we have for each of our clients. When it comes to taking care of families, we prefer to be proactive rather than reactive, and our ongoing client care program helps reduce the stress for our families when it comes time to prepare an estate tax return.
Our Client Care Program can make things easier in the future. Be sure to plan ahead so your loved ones don’t face complications during this process. To learn more about how our ongoing client care program can help your loved ones reduce the stress involved in an estate tax return, give us a call to set up a complimentary consultation.