Estate Tax and Gift Tax Services

Losing a loved one is never easy. Gathering information from a loved one’s income, assets, and various financial accounts and trying to figure out the tax implications don’t make it any easier. Ultimately, taxes and accounting can wait. As we always say to our clients, take care of yourself and your family first. There’s no rush. Once you’ve had the chance to grieve and begin the healing process, give us a call.

Don’t Worry. You’re in Good Hands.

The loss of a spouse or parent is not only emotionally draining, but it can also feel like a heavy burden is being placed on your shoulders. Don’t worry. That’s why we’re here.

We’ll explain what information you need to file an accurate estate tax return without missing any deadlines, and we’ll help you find that information if you’re having trouble. In many cases, this information can be gathered by going through a month of physical mail or searching past emails. Let us walk you through the complexities of estate taxes and make the process as stress-free as possible.

What Is an Estate Tax?

An estate tax is a tax on the transfer of a deceased person’s estate according to a will or state law. The current fair market value of your assets is used to calculate estate taxes. Deductions can include mortgages and other debts, estate administration expenses, and property that is transferred to surviving spouses and qualified nonprofits.

In most cases, an estate tax does not apply. Federal estate taxes are only charged when a deceased person’s assets are valued at $11.58 million or more (as of 2020). No New Jersey estate taxes are charged on the estates of people who passed away on or after January 1, 2018.

Even if you don’t owe estate taxes, it’s important to work with an accountant to ensure you have a complete and accurate accounting of your loved one’s assets. You also need to make sure you have access to those assets, which could require the assistance of an estate lawyer. Also, beneficiaries must pay inheritance taxes on transfers exceeding $25,000. Although direct descendants are not subject to the inheritance tax, all other beneficiaries are.

What Is a Gift Tax?

A gift tax return must be filed when you give a gift of more than $15,000. The person receiving the gift doesn’t have to pay a gift tax. This is a popular misconception. You don’t have to pay a tax for receiving a gift.

Also, the person giving a gift doesn’t have to pay a gift tax until they reach a certain threshold over the course of their lifetime. They just have to file a gift tax return for a gift of more than $15,000. You can give gifts of more than $15,000 without paying a gift tax over the course of your lifetime until the total exceeds $5.4 million. Gifts under $15,000 are not counted. If a married couple wants to give a gift of $20,000, for example, and avoid filing a gift tax return, they can split the gift to keep each gift under the $15,000 minimum