505+ documents containing “estate tax”.
Estate taxes are an important part of financial planning, especially for those who have significant assets they wish to leave to others when they die (Bradford, 2010). Wealthy individuals like John and Jane Smiley may be able to avoid the death tax, depending on how great a level of wealth they actually have. For those who are close to the threshold, as the Smiley's may be, it is very important for them to understand the death tax, so they can take any legal steps they choose in order to mitigate the level of tax they will be asked to pay. To that end, the Smiley's need to understand how much their estate can total before they need to pay the tax, so they will be prepared for any tax that will be left behind and the responsibility of their personal representative when they pass away. Since they have no….
Bradford, B.T. (2010). The Estate Planning Perils of 2010 and Beyond. The Selected Works of Brett T. Bradford. Retrieved from: http://works.bepress.com/brett_bradford/1/ .
IRS. (2013). Estate tax. The Internal Revenue Service. Retrieved from: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Estate-Tax .
Shapiro, I. & Graetz, M.J. (2005). Death By A Thousand Cuts: The Fight Over Taxing Inherited Wealth. NJ: Princeton University Press.
State of Florida. (2012). Estate tax. The State of Florida Department of Revenue. Retrieved from: http://dor.myflorida.com/dor/taxes/estate_tax.html .
Estate taxes, as well as Gifts tax have an influence on individuals in the United States of America. The Federal government imposes laws that govern Gifts and Estates. There has been a lot of uncertainty on Gift and Estate tax, but this cloud has finally disappeared. This reprieve is however, temporal since changes in governments mean new laws. In the year 2013, exclusion of Estate and Gift taxes has been on the rise giving couples time to plan. Tax cuts by the Bush administration had some impact, but this exclusion by president's Obama administration provides relieve to families as well as individuals. The future of Estate and Gift tax in America is bright, but there is a cloud of uncertainty with future changes in government (Gale & Potter, 2002). Therefore, planning process would ensure better practices for years to come.
Estate Tax laws
According to Baker, Bloom & Davis (2013), considering….
Baker, S., Bloom, N., & Davis, S. (2013). Measuring economic policy uncertainty. Retrieved from http://www.policyuncertainty.com/media/BakerBloomDavis.pdf
Stephen, J. (2009). Federal Estate and Gift Taxes. A series of issues summaries from the congressional budget office. Retrieved from http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/108xx/doc10841/12-18 -
Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010:
Thank you for your consideration of our company as your trusted Certified Public Accountant (CPA) and we hope that this is the beginning of a mutually beneficial relationship. Our company provides superior accounting services to clients with a wide range of accounting issues and needs. Therefore, we are ready to provide excellent accounting guidance and expertise that will help you achieve personal and financial success. In addressing your issue of irrevocable trusts, estate tax and gift tax, we will utilize a six-step procedure to provide you with the most reliable professional assistance.
Based on your request to establish an irrevocable trust for your two grandchildren, the determination of the impact of such a trust on gift tax and estate tax is important. An irrevocable trust is one with specified terms that cannot be changed even by the grantor once the agreement has been signed (Garber, 2017). In your case, there is….
Tax Efficient Financial Strategies
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MACOBUTTON AcceptAllChangesShown [name]
Tax Efficient Financial Planning
Astute financial planning in the current economic climate is critical. While we cannot control the ebbs and flows of either the market or the decisions of the government that affect one's personal finances, we can attempt to grow and preserve wealth through tax efficient financial planning. There are solid vehicles available, if utilized correctly, can successfully minimize income, capital gains and estate taxes for our clients. Below provides detailed information on vehicles available to provide minimal tax exposure.
Income Tax Minimization
Deferred Variable Annuities
Using this method clients not only are able to minimize their incomes taxes, but they this vehicle also provides asset protection.
401K or other Qualified etirement Plan
Contributions to a 401k or a similar retirement plan are tax-deferred and not-taxable until withdrawal. Contributions help to lower an individual's AGI thereby lowering their income taxes or even lowering their tax bracket….
Baldwin, W. (2010, July 30). Six Ways To Avoid Capital Gains Tax Page 2 of 3 - Forbes.com. Information for the World's Business Leaders - Forbes.com. Retrieved July 26, 2011, from http://www.forbes.com/2010/07/30/avoid-capital-gains-tax-anschutz-personal-finance-baldwin-tax-strategy_2.html
Botkin, S. (2010). Lower Your Taxes - Big Time 2011-2012. New York: McGraw-Hill.
tax system of one country with that of another is an exercise fraught with dificulties and ultimately doomed to failure . tax system will never be much more than a reflection of strongly national cultures and forces. discuss this statement in the light of your knowledge of comparative tax system in developing and/or developed countries i
The following pages focus on analyzing the factors of influence on different countries' taxation systems. The paper begins with an introductory section that allows readers understand the point-of-view used in this paper. The following section refers to describing the taxes pand taxation systems used by most countries and their objectives, in order to understand the similarities and differences between these taxation systems. The paper continues with the analysis of several factors that influence countries' tax system design, like cultural factors, technological developments, and natural resources. In order to exemplify this, the taxation systems….
1. Pasekova, M. et al. (2011). Comparative Analysis of Tax Systems: Some Evidence from CEE Countries. World Academy of Science, Engineering, and Technology. Retrieved February 27, 2012.
2. Greenhouse, S. (2011). Tiny Tax on Financial Trades Gains Advocates. The New York Times. Retrieved February 28, 2012 from http://www.nytimes.com/2011/12/07/business/global/micro-tax-on-financial-trades-gains-advocates.html?_r=1&pagewanted=all .
3. Ross, M. (2004). Does Taxation lead to Representation? Cambridge University Press. Retrieved February 28, 2012.
4. Seto, T. (2008). Four Core Principles of Tax Design System: Introduced and Applied to the Taxation of Multinationals. Loyola Law School. Retrieved February 28, 2012.
Table of Contents (optional)
Louise is aged 50 and single. Since 1994 she has carried on a retail business as a sole trader. Her trading profits as adjusted for tax purposes and after capital allowances, for the year ended 30th April 2009 were $150,000.
The business is carried out from a number of valuable retail outlets, all of which are owned by Louise personally. These units have been acquired over a number of years since 1994 and their market values have increased considerably in recent years.
Apart from her single personal allowance tax credit, Louise is entitled to income tax relief in respect of $10,000, which she pays annually to a evenue approved pension scheme.
Louise's personal living expenses and other financial commitments total $50,000 per annum (including the contribution of $10,000 to the evenue approved pension scheme referred to above).
Louise is considering transferring her business to a limited company and has asked….
So your wife can renounce the business given to her and then pass it without gift tax to the children. Disclaimers must be made within 9 months of the death of the first decedent if they are to avoid gift tax. An appropriate disclaimer may also be a very effective tool to assist in a poorly written estate plan.
7. JOINTLY HELD PROPERTY:
The joint tenancy form of ownership could result in many unintended and unfavorable consequences. For example, the entire property is usually subject to attachment by a creditor of any one of the joint tenants. There are also significant estate, gift, and income tax problems that are created from joint tenancy. If not given attention and consideration as part of a comprehensive estate plan, holding property together as a couple, can create bad results in terms of overpaying taxes.
Explanation: Solely half of the value of property held by you….
Federal Government Tax
The main source of government income is taxes. The government taxes various organizations in the economy differently to ensure that adequate revenue is collected. Corporate use loopholes in the tax system to reduce the tax paid to the federal government. The government should eliminate these loopholes to improve tax collection. Some taxes such as gift and estate tax as they are counter productive. Changes made to the federal tax collection systems will increase the tax collected by increasing compliance.
esearch the most common tax loopholes used by corporations and partnership to avoid paying federal income tax. Discuss two (2) loopholes identified and what strategies you would recommend to the federal government for closing these loopholes.
The federal government gets most of its revenue from collection of tax used to fund most of the expenditure. The government should ensure that the tax collection avenues are free from loopholes to facilitate efficient….
Gans, J. (2011). Principles of economics. South Melbourne, Vic: Cengage Learning.
Ganghof, S. (2006). The politics of income taxation: A comparative analysis. Colchester: ECPR Press.
Conklin, D.W., St.-Hilaire, F., & Institute for Research on Public Policy. (1990). Provincial tax reforms: Options and opportunities. Halifax, N.S: Institute for Research on Public Policy = Institut de recherches politiques.
Pechman, J.A. (1987). Federal tax policy. Washington, D.C: Brookings Institution.
Income Tax Deduction
Taxes have existed in the United States for all of its existence but they took on many forms prior to the modern income tax. The income tax was not finalized and permanently ensconced in the United States law until the 1910's. The tax rates, at its normal levels, have been adjusted upwards and downwards depending on the economic cycles with the most recently developments being the "Bush Tax Cuts" of the 2000's and the recent tax spikes under the Obama Administration. While income taxes affect some more than others, nearly all people are affected based on the assets/income they possess and earn as well as the familial structure they maintain.
Common Tax Deductions
As noted in the introduction, familial status and assets/income are far and away the biggest determinants on how much tax is paid, if any. Indeed, some people actually get money from the government and technically have a….
IRS. (2014, February 28). Internal Revenue Service. 401(k) Plans. Retrieved February 28, 2014, from http://www.irs.gov/Retirement-Plans/401 (k)-Plans
IRS. (2014, February 28). The Health Insurance Marketplace. The Health Insurance Marketplace. Retrieved February 28, 2014, from http://www.irs.gov/uac/Newsroom/The-Health-Insurance-Marketplace
IRS. (2014, February 28). SOI Tax Stats - S Corporation Statistics. SOI Tax Stats - S Corporation Statistics. Retrieved February 28, 2014, from http://www.irs.gov/uac/SOI-Tax-Stats-S-Corporation-Statistics
IRS. (2014, February 28). EP Abusive Tax Transactions - S Corporation ESOP Abuse of Delayed Effective Date for Section 409(p). EP Abusive Tax Transactions - S Corporation ESOP Abuse of Delayed Effective Date for Section 409(p). Retrieved February 28, 2014, from http://www.irs.gov/Retirement-Plans/EP-Abusive-Tax-Transactions-S-Corporation-ESOP-Abuse-of-Delayed-Effective-Date-for-Section-409 (p)
It falls on savers, not spenders;
3) Early and naive advocates of death taxes thought that such taxes would not distort behavior because they fell only on wealth that decedents left behind by accident. Now very strong evidence supports the common-sense idea that people are strongly motivated to leave wealth to their heirs. Death taxes distort the behavior and investment decisions of this important class of "intergenerational" savers;
Not only does the income tax not need a "backstop," the income tax is actually a bad tax precisely because it falls on savings, in effect double taxing saving as opposed to immediate consumption. Death taxes compound the error by adding a third tax on savings. A fair tax system should consistently tax spending, not work or savings, and should use progressive rates to meet whatever liberal or redistributive objectives it has;
Death taxes have not contributed to greater equality in America. In fact,….
The Effects on Government Revenues from Repealing the Federal Estate Tax and Limiting the Step-up in Basis for Taxing Capital Gains (2003) CONSAD Research Corporation, Pittsburg Pennsylvania. Online available at http://www.sirote.com/Menus/BioLinks/HIA-Estate-Tax-Final-Report-Consad%5B1%5D.pdf
Kamin, David (2004) New CBO Study Finds that Estate Tax Repeal would Substantially Reduce Charitable Giving. Center on Budget and Policy Priorities. 3 Aug 2004. Online available at http://www.cbpp.org/8-3-04tax.htm
Herman, Tom and Silverman, Rachel Emma (2005) Republications Consider Keeping Estate Tax Alive for the Very Rich. Wall Street Journal 19 Jan 2005. Responsible Wealth Project. Online available at http://www.responsiblewealth.org/press/rwnews/2005/EstateTax_WSJ.html
McCaffery, Edward J. (1999) Grave Robbers: The Moral Case Against the Death Tax. CATO Policy Analysis 4 Oct 1999. Online available at http://www.cato.org/pubs/pas/pa353.pdf
Trusts and Taxes
"Gift Transfers and Gift Tax Planning"
An irrevocable trust could be used as a way to name beneficiaries and avoid estate taxes. Unlike a revocable trust, irrevocable trusts do not have to pay taxes. In this case, any assets that are placed in the irrevocable trust are no longer deemed to be assets of the settler; instead they are deemed assets of the trustee. The difference is that in a revocable trust, the settler can re-enter into the trust and have the assets retrieved. In an irrevocable trust, this is not allowed. Creditors cannot retrieve assets of the settler in an irrevocable trust, as they can in a revocable trust.
As Bay Financial Associates (2015) puts it, a revocable trust is like a "box with strings" on it -- and all one has to do is pull the string, and the box opens up. An irrevocable trust, on the other….
Bay Financial Associates. (2015). The Irrevocable Trust. BFA. Retrieved from http://www.bfa-online.com/news012.html
Ebeling, A. (2015). House votes 240-179 to repeal estate tax. Forbes. Retrieved from http://www.forbes.com/sites/ashleaebeling/2015/04/16/house-votes-240-179-to-repeal-estate-tax/#f6643f7f3e6f
Smiths to Minimize Their Total Tax Liability
Mr. and Mrs. Smith's concerns about their future income and estate tax bills are important because of their need to engage in tax planning, which can be described as organizing personal financial affairs in order to lessen taxes. In light of their concerns and current situation, there are several recommendations or ways with which the Smiths can reduce their future income and estate tax bills. Therefore, your advice to them on tax planning should be based on considerations of these various recommendations in light of their advantages and disadvantages in addressing their concerns.
One of the ways through which the Smith's can minimize their total tax liability is through giving annually, which will help lessen future estate taxes. As of 2015, the federal estate gift and estate tax exemption amount was $5.43 million, which implied that taxable estate exceeding this amount would be subject….
Bischoff, B. (2015, March 5). 5 Ways to Give Your Home to Your Children Tax-Free. Retrieved June 29, 2017, from http://www.nextavenue.org/5-ways-give-your-home-your-children-tax-free/
First Republic Investment Management. (2017, March 20). Gifting to Family Members: Pitfalls and Benefits. Retrieved June 29, 2017, from https://www.firstrepublic.com/all-articles/life-and-money-plan-your-legacy/gifting-to-family-members-pitfalls-and-benefits
Kohler, M.J. (2015, June 18). Why You Should Hire Your Kids This Summer. Retrieved June 29, 2017, from https://www.entrepreneur.com/article/223968
Massachusetts Financial Services Company. (n.d.). Minimize Taxes with Estate Planning and Gifting. Retrieved June 29, 2017, from https://www.mfs.com/wps/FileServerServlet?servletCommand=serveUnprotectedFileAsset&fileAssetPath=/files/documents/heritage/hp_epgift_flye.pdf
The fact that the tax liability does not distinguish between qualified and non-qualified assets, means that they many people will have higher taxes when they begin taking these distributions. (Gambone, 2010) (Fisher, 2010)
This is particularly troubling because this kind of asset is often exempt from various estate and inheritance taxes. As many of the different pension and retirement plans will often claim how these investments are considered to be tax free. Yet, on the federal level there is no such distinction. This is troubling, because the conflicting regulations as far as taxes are concerned, will have an impact upon the underlying return that are investors are receiving. Where, they assume that they will be able to receive a substantial amount of tax benefits, while being able to invest in conservative areas that can provide them with continuous growth. As a result, most people are surprised by the sudden tax….
Annuity. (2011). Invest Words. Retrieved from: http://www.investorwords.com/225/annuity.html
Frequently Asked Questions about Pension Plans. (2011). Department of Labor. Retrieved from: http://www.dol.gov/ebsa/faqs/faq_compliance_pension.html
Pennsylvania Inheritance Tax. (2010). Pennsylvania Department of Revenue.
Pennsylvania Inheritance Tax. (2009). Pennsylvania Department of Revenue.
In Pennsylvania taxation is a huge issue, much like in the rest of the United States. arring factions on either side of the political agenda work to either raise or cut taxes within a given year. In times of economic crisis, such as is occurring in the United States at the present has forced citizens and government officials to reexamine taxation practices in the hopes of overturning the depression. In additional to federal taxes, businesses and individuals of the U.S. are required to pay taxes to the state and to their local communities (Financing page 458). State taxation can be extraordinarily high. It has been proven that many states have higher corporate tax rates than several countries of the world. hen comparing Pennsylvania to other states in the country, it becomes apparent that the current tax rate is exorbitant and putting a great deal of pressure both on….
same-sex marriage refers to a legal married union between two persons of the same sex. In other word, same sex partner is a man legally married to another man or a woman legally married to another woman. Since same sex marriage is a new development in the United States, the federal government has faced challenges in treating the tax issues of same-sex individuals entering into marriage. The IS's (Internal evenue Service) ruling of 58-66 in 1958-1 C.B.60 determines the tax purpose for individuals who have entered into a common law marriage. Under the state law administered by the Federal income tax laws, the IS acknowledges that it recognizes individual's marital status.
Under IS uling 58-66, the Service states that a couple will be treated as married based on the Federal income tax filing purpose, and the IS has applied this uling 58-66 for over 50 years. (Internal Service evenue, 2014).
Ahroni, S. & Silliman, B.R.(2014). Federal Tax Implications of Windsor . 84(7):CPA Journal.58-63.
Calhoun, C.V. (2015). State Taxes and Married Same-Sex Couples. Calhoun Law Group, P.C.
Cornell University (2015). United State v Windsor. Legal Information Institute.
Goodnough, A. Zezima, K. (2009). Suit Seeks to Force Government to Extend Benefits to Same-Sex Couples. The New York Times.
Tax Estate taxes are an important part of financial planning, especially for those who have significant assets they wish to leave to others when they die (Bradford, 2010). Wealthy…Read Full Paper ❯
Taxes Estate taxes, as well as Gifts tax have an influence on individuals in the United States of America. The Federal government imposes laws that govern Gifts and Estates.…Read Full Paper ❯
Accounting / Finance
Thank you for your consideration of our company as your trusted Certified Public Accountant (CPA) and we hope that this is the beginning of a mutually beneficial relationship. Our…Read Full Paper ❯
Tax Efficient Financial Strategies Company Name Here Managing Director MACOBUTTON AcceptAllChangesShown [name] Tax Efficient Financial Planning Astute financial planning in the current economic climate is critical. While we cannot control the ebbs and flows…Read Full Paper ❯
tax system of one country with that of another is an exercise fraught with dificulties and ultimately doomed to failure . tax system will never be much more…Read Full Paper ❯
Tax Advise Table of Contents (optional) Louise is aged 50 and single. Since 1994 she has carried on a retail business as a sole trader. Her trading profits as adjusted for…Read Full Paper ❯
So your wife can renounce the business given to her and then pass it without gift tax to the children. Disclaimers must be made within 9 months of…Read Full Paper ❯
Federal Government Tax The main source of government income is taxes. The government taxes various organizations in the economy differently to ensure that adequate revenue is collected. Corporate use loopholes…Read Full Paper ❯
Income Tax Deduction Taxes have existed in the United States for all of its existence but they took on many forms prior to the modern income tax. The income tax…Read Full Paper ❯
It falls on savers, not spenders; 3) Early and naive advocates of death taxes thought that such taxes would not distort behavior because they fell only on wealth that…Read Full Paper ❯
Trusts and Taxes "Gift Transfers and Gift Tax Planning" An irrevocable trust could be used as a way to name beneficiaries and avoid estate taxes. Unlike a revocable trust, irrevocable trusts…Read Full Paper ❯
Accounting / Finance
Smiths to Minimize Their Total Tax Liability Mr. and Mrs. Smith's concerns about their future income and estate tax bills are important because of their need to engage in…Read Full Paper ❯
The fact that the tax liability does not distinguish between qualified and non-qualified assets, means that they many people will have higher taxes when they begin taking these…Read Full Paper ❯
Tax Analysis In Pennsylvania taxation is a huge issue, much like in the rest of the United States. arring factions on either side of the political agenda work to…Read Full Paper ❯
Women's Issues - Sexuality
same-sex marriage refers to a legal married union between two persons of the same sex. In other word, same sex partner is a man legally married to another…Read Full Paper ❯