Senator Baucus says that once Congress presents a bill for President Obama to sign, the estate tax changes will be retroactive to January 1st. Hopefully, this can be done.
Through December 31, 2009, $3.5 million ($7 million for a married couple if the will is drafted properly) of an estate's value was free of Federal estate taxes (for some states however a state tax may still apply - but not in VIRGINIA; MARYLAND still has a $1 million limit, for example).
Effective January 1, 2010, however, there is no estate tax. But what does go away is the "step-up" in basis for estate values. That is, if more than $1.3 million (plus an additional $3 million for a spouse).
Yes, it is complicated but it is important to realize that high-value estates could result in the heirs having to calculate the "original cost" of property and then, if sold later, may have to pay a 15% capital gains tax based on the heir's tax return.
Confusing? Thank Congress. Hopefully it will be resolved by the time I post this.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.