Proper Estate Planning Can Avoid Being Hit with a Significant Taxable Estate in New York
One’s estate is comprised of the dollar amount of the value of all your property when you die. Your property includes your house, bank accounts, retirement accounts, insurance policies, etc. The value of all your assets are subject to both NY and Federal Estate Taxes to the extent that the value exceeds the exempt amounts.
The Federal Estate and Gift Tax Exemption was increased to $ 11.58 million per individual in 2020. That means that you can leave this amount to heirs and no federal estate or gift tax will need to be paid. This also means that a married couple can pass $ 23.16 million. The exemption is not automatic, you can leave 11.58 million to your surviving spouse free of federal taxes by electing it on the final tax return of the spouse who is the first to die.
While most do not have an issue avoiding Federal Estate Taxes, New Yorkers must be wary of the NY Estate Tax exemption which is currently $ 5.85 million for 2020. If one dies with an estate of $5.7 million, no federal or state estate tax would be due. However, if one dies with an estate in excess of $ 5.85 million up to $6,412,844 while no federal estate tax is due, the portion exceeding $ 5.85 million will be taxed at rates between 100% up to almost 250%.
There are certain estate and gifting strategies that can be utilized by a New Yorker to minimize the impact of the NY Estate Tax. Reach out to discuss further!
Please contact us to schedule your free legal consultation.
Email: [email protected]
Telephone: (516) 271-3032
Text directly from our website: www.elderattorneylongisland.com
The above is provided for informational purposes; Recommendations for your matter may differ.