|Founding Father Benjamin Franklin wasn’t the first to express the thought, but he made it famous for posterity when he wrote in a letter to Jean Baptiste Le Roy in 1789, “… nothing in this world can be said to be certain, except death and taxes.” Someone’s passing raises many tax issues, responsibilities, and planning opportunities during the administration of their estate and trust. The number and complexity of these income and estate tax opportunities can overwhelm surviving spouses, Personal Representatives, and Successor Trustees. Therefore, it is important to have an idea of these matters so that important filings and elections are made to preserve assets and pass on a greater legacy.
Here’s a sample of the tax issues and responsibilities families and their advisors face when someone passes away:
We understand it can be extremely challenging to navigate the multiple legal, tax and financial matters while coping with the loss of a loved one. It's important that your entire team of attorneys, accountants, financial, and banking advisors work together to maximize the family legacy during a difficult time. Our firm is here to shepherd families through the tax and legal challenges so they can focus more energies on healing and moving forward.
Attend this webinar to understand more about the tax implications when someone passes.
- Obtain a Tax ID number for the estate and/or trust;
- File a final income tax return for the decedent;
- Determine if an estate tax is due and file an estate tax return for the decedent;
- If no estate tax return is due, should an estate tax return be filed;
- File an income tax return for the estate/trust while the estate/trust is open;
- Determine whether to include trust income on the estate’s income tax return;
- Whether a calendar year or fiscal year tax return is advisable;
- How to pay for estate taxes and who’s responsible for paying them;
- Making special tax elections for business interests or spouses;
- Whether estate taxes can be reduced or deferred.