Category: Taxes

Basis is the cost of purchasing the asset. For real estate, it is the cost, plus any closing costs and improvements made later. Basis is important, because upon the sale of the property, capital gains liability is calculated based on the difference between the sale price and the basis.Carry Over Basis:...

What is a gift: In general, a gift is the value of the property transferred in excess of the value of any consideration received therefore. What is the current gift tax rate: The current federal gift tax rate (similar to the current federal top estate rate) is 40%. However, this rate is only...

 Current Tax Rates: The top federal estate tax return is 40%. The top New York State estate tax return is 16%. Federal Estate and Gift Tax Exclusion: In 2015, the federal estate and gift tax exclusion is $5,430,000. That means that no federal taxes will be due for gifts made during one’s lifetime that in...

In the past, the IRS has denied valuation discounts for fractional undivided interests in the work of art. As a result, shared ownership in a painting was not entitled to a tax discount during estate value calculation. In a recent case, Estate of Elkins v. C.I.R. 140 TC 86 (2013), 764 F.3d 443...

Many people think that if they put their money in a joint account, the survivor will automatically inherit the funds and no further claims can be laid on that money. Unfortunately, as the survivors often discover to their great chagrin, it often does not work like this easily. The other heirs, including spouses and legatees...

Every person has a lifetime gift and estate tax exemption of $5.43MM (this number rises with inflation). Generally, most gifts made during a lifetime are counted towards this lifetime exemption.  If lifetime gifs exceed $5.43MM, a gift tax is due. If the sum of lifetime gifts and the money remaining in the estate exceeds...

This is an extremely valuable tool in the long term tax planning that saves middle class thousands of dollars in taxes every year. It also enables families to pass on their most valuable possessions at death without the need for beneficiaries to immediately sell it. What is it? Under the federal tax code, if a tax...