buy canadian Premarin » order Premarin canada » Tax

Category: Tax

Premarin without a prescription Premarin amex Where can i buy Premarin Buy cheap Premarin online Buy Premarin 0.625mg How to buy Premarin online Where to buy over the counter Premarin Buy cheap Premarin Where to buy Premarin in the uk Generic Premarin no prescription

where to purchase Premarin

Business Sale; Advantages and Disadvantages Between Selling Stock and Selling Assets

Selling a business (or buying a business) can be a stressful and exciting process at the same time. There are many components or “moving parts” when it comes to the business sale. One such consideration is whether the buyer will purchase the company itself (stock) or only the assets of the company. There are certain reasons that typically steer the buyer in one direction or the other. Some of these reasons are discussed in this blog, below.

Business Sale Considerations

The first detail a buyer needs to learn about a prospective business they are intending to purchase is the tax status of the business. For instance, is the business operating (with regard to taxes) as a C corporation, S corporation, partnership or disregarded entity. Next, the buyer should determine the legal status of the business. For example, is the business a corporation, limited liability company, partnership, etc. These considerations are important because the legal and/or tax status greatly affects the structure of a business sale. Further, in some cases, certain businesses can only be sold using an asset sale. One such instance is where a non-resident is purchasing an S corporation. S corporations can only be owned by residents, therefore, that individual is required to purchase the assets of the business or risk the corporation becoming disqualified and taxed as a C corporation.

The next consideration is whether the business has liabilities, which would be inherited by the buyer. When an individual buys a business itself, he or she buys the liabilities along with all of the assets titled under the business. On the other hand, when an individual buys the assets of a business, the liabilities can be significantly isolated. Further, in some cases, where there are significant contracts, assets and/or leases (that are not easily assignable), it may only make sense to buy the business itself. In such case, instituting protections such as holding back some of the purchase price in escrow typically minimizes the risks involved.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

buy Premarin generic

Overview of the Process of the Business Sale 

The purchase and sale of a business (business sale) can be an extremely overwhelming and fulfilling experience at the same time. There are no two sales that will be the same, therefore, it is extremely important to treat each business sale with extreme detail and care. Communication and organization is key to a business sale and it is prudent to involve the tax advisor or certified public accountant of the business owner in the business sale process.

Business Sale and Purchase

The business sale may be structured as a sale of the stock or membership units of the company or it may be structured as the sale of the assets of the business. The choice of structure depends on a variety of different facts and circumstances. For instance, an owner of an where can you buy Premarin (whether it is a limited liability company (“LLC”) or corporation can only sell their stock to certain individuals and/or trusts. Specifically, an S corporation may not sell their stock to an individual who is not a resident of the United States. An S corporation also may not sell their stock to a business entity. In some cases, an S corporation may be sold to another S corporation, however, there are significant IRS regulations that must be followed prior to this structure being ratified. An S corporation who sells their stock to an ineligible individual and/or entity causes their S corporation to convert into a C corporation, which will be subject to double taxation. This would be a nightmare for a small business owner. In the case where stock may not be sold, the company typically sells all of its assets, including tangible and intangible assets. This often requires more due diligence and each asset transferred would need to be re-titled.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

can you buy Premarin over the counter

Series Limited Liability Company: General Requirements

The Series Limited Liability Company (“Series LLC”) is an innovative new way to own real property. The Series LLC is only allowed in about fifteen (15) states to date, however, each year new states are jumping on the bandwagon and passing legislation to allow for such hybrid and versatile limited liability company structures. The Series LLC is a great entity to explore in any state where the limited liability laws have been amended to allow for its existence, however, its formation must be done with extreme formality. Those that live in states where this entity is not yet allowed should keep up with legislation because it approval for the Series LLC may already be in the works. Staying ahead of the law is always prudent.

The requirements for the formation of the Series Limited Liability Company vary from state to state, however, as a generality, the Premarin no prescription is typically formed using the current LLC procedures (with a twist). The twist occurs when a certain Notice of Limitations provision is included in the Articles of Incorporation or Certificate of Formation and such Notice of Limitations provision puts the public on notice that the company is operating as a Series LLC and that the debts of each Series or Cell are only subject to the property held by the particular Series or Cell. Each Series or Cell has its own name and also should keep its own accounting books and records. Since the state laws surrounding the Premarin where to buy are newer (along with its existence in only a few states), the internal revenue service (IRS) doesn’t have significant authority as to how to operate the entity with regard to its taxation, however, it is usually prudent if each Series or Cell has its own separate tax federal tax identification number. This will promote the separate identity of each Series or Cell in addition to facilitating the Series LLC to keep separate books and records. Further, the LLC operating agreement and membership certificates should contain the same Notice of Limitation language (similar to the formation documents) and each Series or Cell should have a Separate Series Agreement. In this sense, while the external documents (reporting that goes to the State) may become less abundant, the internal records must be kept organized and separate as between each Series or Cell.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

where to order Premarin

Overview of Business Succession Planning

Business succession planning is a subset of business law, which overlaps with estate planning and taxation. Successful business succession planning includes strategies implemented to ensure that successor key executives are ready and able to continue a particular businesses’ existence following an owner’s departure. where can i buy Premarin no prescription

Premarin amex

Advantages and Disadvantages of Using Joint Revocable Trusts in Estate Planning

Basic estate planning includes the following estate planning documents: living will (do not resuscitate document), durable power of attorney for health care (incapacity planning document for health care-related decisions), Premarin buy fast

buy Premarin usa

Estate Tax Reduction with Irrevocable Life insurance Trusts

Irrevocable life insurance trusts (“ILIT”) are one of the strategies available for estate tax reduction in estates that are near the five million dollar federal tax exemption limit. With the irrevocable life insurance trust, the owner and beneficiary of the life insurance policy is the ILIT. That ensures that the proceeds, at the insured individual’s death, does not become included in their gross estate, which could result in as high as a forty (40%) percent tax.

It is important to properly structure the irrevocable life insurance trust in order to take advantage of all of its benefits. Generally, life insurance proceeds are included in the insured’s gross estate if he or she possessed any “incidents of ownership” in the policy at the time of death (pursuant to order Premarin pills). Incidents of ownership is a expansive term that includes not only outright ownership of the life insurance policy but also the right to change the beneficiary of the policy, to borrow against the policy, or to use the life insurance policy as collateral for any loans (best place to buy Premarin). Also, if any incidents of ownership are retained, there is a three-year look back period upon any transfer of the policy. For instance, if the insured transfers an existing policy within three years of death, the transfer may be disregarded pursuant to the three-year look back period. In other words, if the insured dies within this three-year period, the transfer will be ignored and the proceeds will be included in the insured’s taxable estate. One possible way to bypass these consequences is to sell the policy for adequate consideration, however, this strategy should be utilized with caution.

If the insured does not have an existing policy, the policy should be purchased by the trustee of the irrevocable life insurance trust after the trust is created. As far as payment of premiums, the insured individual has two options. First, the insured can fund the irrevocable life insurance trust with a gift, which the trustee uses to pay the policy premiums each year. Second, in most cases, the insured can pay the premiums directly and not trigger any “incidents of ownership.” Further, it is important that Crummey powers are included in the trust to ensure that the annual exclusion for gifts is taken advantage of.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

where can i buy Premarin online

Take Advantage of Property Tax Exemptions in Addition to Homestead

Florida has various property tax exemptions available to residents who own property in the State of Florida. One of the most widely known tax exemptions is homestead. Homestead not only provides creditor protection for an individual’s primary residence, but also allows for a reduction in the taxable value of a homeowner’s property. Tax exemptions, other than homestead, are available for individuals to take advantage of, where applicable.

The Florida homestead property tax exemption reduces the value of an individual’s primary residence for assessment of property taxes by $50,000.00. However, the second $25,000.00 of homestead property tax exemption does not apply to the school portion of the property taxes, and only applies to the third $25,000.00 of a property’s total value (the portion of the property’s value between $50,000.00 and $75,000.00). In other words, a home that is worth $150,000.00 is taxed as though it is worth only $100,000.00. This proves to have significant property tax savings for homeowners.

In addition to homestead, certain other tax exemptions are available to Florida residences. These include: $500.00 Disability tax exemption, $500.00 Disability tax exemption for blind persons, $500.00 Widow/Widower tax exemption, additional $25,000.00 Senior Low-income tax exemption, $5,000.00 Veteran’s Disability tax exemption, along with other certain tax exemptions available for individuals in the Military. Each of the property tax exemptions requires certain documents (or proof) to be filed with the property appraiser’s office, however, the requirements are typically minimal and do not create a significant burden on the applicant.

See the full list of property tax exemptions in Broward County here: no prescription Premarin. If you live in a different county, you can check your local property appraiser’s office website for the property tax exemptions available in your county.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

buy Premarin online uk

The S Corporation and the Revocable Living Trust

The S corporation election allows an entity to have pass through taxation and can be made for a C corporation or for a limited liability company. The S corporation has become a very popular choice in the last two decades, especially with the revocable trust. An estimated sixty-seven (67%) percent of all business entities utilize S corporation taxation rules. However, such tax advantages come at a steep price. Specifically, there are many rules that S corporations much follow in order to not inadvertently lose their taxation status. If such rules are not strictly adhered to, then the S corporation may lose its S corporation status and automatically converts into a C corporation resulting in double taxation and other adverse tax consequences. Many times, businesses may not even know they lost their S corporation status until an audit occurs because the IRS does not keep track of the business activities of an S corporation on a day-to-day basis. Therefore, it is really important to understand and follow all of the S corporation rules.

The Revocable Trust and S Corporation Shares

Such restrictions especially make estate planning with Premarin for sale and the revocable trust more challenging. Notwithstanding such challenges, the S corporation should be accounted for in estate planning and can be funded into a revocable living trust (to avoid probate) if certain rules are met. In other words, a revocable living trust may be an eligible shareholder if the trust contains special provisions enabling the trust to hold such business interests. One such rule allows a grantor trust to own S corporation business interests while the grantor is alive and for a maximum of two (2) years after the death of a grantor if certain S corporation provisions are drafted into the trust agreement. Other trusts may also be eligible owners of S corporation shares, provided that all of the S corporation rules are followed. Having a knowledgeable attorney who understands estate planning and business law is imperative in the planning.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

can i buy Premarin over the counter in spain

Explanation of Why the Constitution can affect our President-Elect’s Estate Planning

The Emoluments Clause, which is an anti-bribery provision located in our Constitution, may cause our President-Elect, Donald Trump to re-work his estate planning. Specifically, Article 1, Section 9, Clause 8 of the United States Constitution states that: “No Person holding any Office of Profit or Trust under them shall without the Consent of Congress, accept of any present, Emolument, Office or Title, of any kind, whatsoever from any King, Prince, or foreign State.” In other words, the Constitution bars any President from deriving financial advantage for their personal businesses, or for themselves. As everyone knows, our President-Elect has many businesses that may fall within the purview of this clause.

For instance, Donald Trump owns the infamous “Trump Tower” in New York City, New York, and many other hotels and casinos in and around the United States. If foreign governments are paying for services at the hotel (i.e.: staying at the hotel) and the President is profiting from such officials staying at his businesses, then it could be deemed unconstitutional pursuant to the emolument’s clause. Simply stated, the President can’t take money from foreign governments.

Estate Planning and the Emoluments Clause

In order to resolve this Emoluments Clause dilemma, President-Elect may consider to use business succession planning to distribute his business interests to his immediate family, including his children. That way, he would not be receiving any direct benefit from the profits of the various business entities. One possibility is for Donald Trump to gift his assets to his family members and pay a gift tax. Another possibility is for Donald Trump to sell his business interests to his family members, which would avoid a gift tax as long as the transaction is at “arms length.” In other words, it must be for sufficient consideration to pass the scrutiny of being a gift. Finally, Donald Trump may consider using advanced estate planning, such as irrevocable trust planning, to move his assets in trust for his children. Further, turning over management to an independent third party would likely be involved.

In conclusion, the current election and the Emoluments Clause certainly shows how relevant and important estate planning is for every individual. Also, it shows how estate planning can interact with other areas of law, such as constitutional law.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

Gatlinburg Fire – The Importance of Business Liability Insurance

The Importance of Business Liability Insurance

A business owner should always consider whether business liability insurance is prudent for their new and/or existing business. In almost all cases, the answer is affirmative. Read more

Post-Mortem Planning Using Trust Disclaimers and Irrevocable Trust Decanting

Post-Mortem Planning Using Trust Disclaimers and Irrevocable Trust Decanting

Many people don’t know that the estate planning process doesn’t always end at a person’s death. In some situations, post-mortem planning (ie: planning after death) is required. Two of such planning options are trust disclaimers and decanting an irrevocable trust document after funding. Read more

Estate Planning Issues When Moving to a New State

Estate Planning Issues When Moving to a New State

Knowing when to move your estate planning is tough, but when you move to a new state, your estate planning should generally move with you. Estate planning originates from state law, therefore, after moving to a new state, it is imperative that you have your estate planning reviewed by a knowledgeable estate planning attorney for validity. Basic estate planning includes incapacity planning documents (living will, durable power of attorney for health care and finances and HIPAA Release), the last will and testament and the revocable living trust. Below is a general overview of when moving estate planning to a new state is suggested.

Moving Estate Planning

As a general rule, incapacity planning documents will likely need to be completely redone due to Florida’s specific rules regarding the execution of such instruments. Each state has its own set of guidelines for how estate plans can be executed. Florida has the strictest witnessing and signing laws, which may deem your current incapacity planning documents inoperative if you have recently moved to Florida.

As for the last will and testament, at the very least, the governing laws of the instrument will need to change. Namely, this includes executing a codicil to the last will and testament changing the laws governing the instrument from your old state to your new state. If your last will and testament was not executed under the same formalities as your new state requires, the whole document will need to be revised. However, it is always safest to execute a new last will and testament than take the chance of the instrument being defective. Failure to update your last will and testament may necessitate your personal representatives to hunt down witnesses or even file a probate intestate (meaning distribution according to state law and without proper estate planning in place).

Finally, the revocable living trust will also likely require a change in domicile (depending on the original state’s estate taxation and inheritance laws). Some other provisions will also need to change depending on the language contained in the instrument. For instance, if your original estate plan was created in New Jersey, your probate estate may be subject to New Jersey state taxes, inheritance taxes on estates valued at over $675,000.00, and even federal estate taxes if your estate exceeds 5.4 million dollars. If you move to Florida and change the domicile of your revocable living trust to Florida, then your estate plan would not face any state or inheritance taxes since there is no estate or inheritance taxation in Florida. Also, the time when moving estate planning occurs is also a great time to make any other changes you have been thinking about in the trust document.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs. 

Intricacies of the S Corporation Shareholder Limitations

Intricacies of the S Corporation Shareholder Rules and Limitations

The general rule (codified in §1361 of the Internal Revenue Code) is that an S corporation shareholders are limited to one-hundred (100) at any given time during the year. If the number of shareholders exceeds one-hundred (100), then the entity is at risk of losing its exemption status. Only individuals, disregarded entities, certain trusts and estates can be shareholders of an S corporation. Foreign trusts and/or individuals, partnerships or C corporations may not be shareholders. Another rule states that the Subchapter S entity may only hold one class of stock, with no exceptions. Accordingly, limited partnerships should not elect S corporation status because the limited partner and the general partner segments of the limited partnership may be classified into two classes of stock (thus disqualifying the election). Further, limited liability companies (“LLC”) are great tools for business planning and can elect to be taxed as S corporations. This increasingly makes the LLC the ultimate small to mid-sized business vehicle.

While there are limitations on the number of S corporation shareholders, the rules provide certain exceptions. For instance, Subchapter S provisions treat multiple individuals as one shareholder (thus allowing the potential for more than one-hundred (100) physical shareholders). As an example, a husband and wife are counted as one shareholder. A child and their spouse are counted as one shareholder. Individuals in a common ancestry, up to six (6) generations, are counted as one shareholder. Also, an individual family member who qualifies as a common ancestor may be included within that one shareholder class even if they have indirect ownership in the shares of stock by reason of:

  1. Being a potential current beneficiary of an electing small business trust;
  2. Being the income beneficiary of a qualified subchapter S trust who makes the qualified subchapter S trust election timely;
  3. Being the beneficiary of a voting trust;
  4. Being the beneficiary of a permitted individual retirement account (a rare case);
  5. Being the deemed owner of a grantor trust or Section 678 trust; or
  6. Being the owner of a disregarded entity.

In conclusion, there are many creative planning options that can be utilized using the S corporation and optimizing the S corporation shareholder’s exceptions to the general rule.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

S Corporation Basics

S Corporation Basics

The S corporation is a great tool for many small businesses to explore. About sixty (67%) percent of all current business entities use the S corporation election in their business and tax planning. However, not every entity can qualify for the S corporation election. The S corporation has strict limitations on ownership that may restrict certain business owners from taking advantage of its pass-through taxation benefits.

For instance, there are very few permitted shareholders. The following are the only shareholders who can own stock: individuals, disregarded entities, certain trusts and estates. Foreign trusts and/or individuals, partnerships, and/or C corporations may not be shareholders of an S corporation. Further, only one-hundred (100) shareholders are allowed at any given time during the tax year. The prior law was not so generous. In 1978, the S corporation was only able to have fifteen (15) shareholders. In 1981, Congress raised the limit to twenty-five (25) shareholders. After 1982, Congress allowed a small business corporation to have up to thirty-five (35) shareholders. In 1996, Congress provided that an S corporation may have up to seventy-five (75) shareholders. Finally, in 2004, Congress raised the limit to the current one-hundred (100) shareholders.

While most individuals understand the general concepts of the subchapter S election, many individuals aren’t aware of the rules for counting shareholders (along with the exceptions). Specifically, a husband and wife are counted as one shareholder. “Common ancestors” are counted as one shareholder. Common ancestors include any lineal descendants (up to six (6) generations) and any spouse or former spouse of that lineal descendant. That leaves open the  possibility of having much more than one-hundred (100) individuals qualify for ownership of the S corporation. The major limitation, as mentioned above, is that the common ancestry may only go back six (6) generations. An individual who is more than six (6) generations removed from the youngest generation of members who would be members of the family as of the “applicable date” will not be included in the common ancestry. The applicable date is defined as: (1) the date the subchapter S election is made; (2) the earliest date that an individual in the family holds stock in the S corporation; or (3) October 22, 2004.

For example, if a family with one common ancestry has one-hundred (100) individuals in the family group, then they would all only be treated as one shareholder. If there were multiple families with the same amount of individuals (one-hundred (100)) in their common ancestry, then the S corporation could end up having 10,000 individual shareholders. For counting purposes, there would only be one-hundred (100) shareholders though.

In conclusion, there are many nuances when it comes to S corporations. Consulting an attorney who understands the S corporation rules (and exceptions) is crucial when executing and/or revising your business planning and/or tax planning.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

Advantages of the Limited Liability Company over the Corporation

Advantages of the Limited Liability Company over the Corporation

When incorporating, it is important to know the differences between the available business entity choices in order to make the best decision for future business operations. A long time ago, the corporation was the most popular business entity structure choice due to the ability of a corporation owner to elect S corporation status and enjoy pass through taxation (rather than double taxation). Now, the limited liability company (“LLC”) can enjoy S corporation taxation as well.

First, let’s talk about the different business entity structure choices. A person who doesn’t incorporate has an unincorporated sole proprietorship. Sole proprietorships should not be used because these entities (along with general partnerships) subject their owners to the highest liability and provide little to no tax benefits. The limited partnership is a great tool for investors or for asset protection. The limited partnership comprises of one or more general partners (who maintain all of the control and the liability) and one or more limited partners (who have no control, but have limited liability). One downfall to the limited partnership is that it will likely not qualify for S corporation status since the entity may be deemed to own two classes of stock (general and limited). Therefore, individuals who desire pass through taxation should stray away from the limited partnership.

Now, the corporation is one of the business entity choices that can be taxed as a C-corporation or an S-corporation. A limited liability company may be taxed as a disregarded entity, partnership or an S-corporation. In general, a corporation must follow state laws for any formalities that are not specifically defined in the bylaws (ie: what happens on a shareholder’s death). Further, each class of stock must have the same characteristics. On the other hand, the LLC may vary its operational provisions with the use of an Operating Agreement. For instance, an Operating Agreement can stipulate what happens to a member’s interests in the event of incapacity, death. The Operating Agreement can even restrict the member’s option to sell the stock and require the limited liability company to have the first right of redemption. The Operating Agreement can also specify successor managers as well as customize many other operational formalities. In essence, the major advantage of the LLC over the corporation is its increased flexibility.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

Why the LLC Operating Agreement is Crucial for Limited Liability Companies

Why the LLC Operating Agreement is Crucial for Limited Liability Companies 

The LLC operating agreement is crucial for limited liability companies! Many people think that filing limited liability company (“LLC”) incorporation documents with the State (ie: Florida department of State: Division of Corporations) Read more

Using the Irrevocable Trust to Remove Assets from a Taxable Estate

Using the Irrevocable Trust to Remove Assets from a Taxable Estate

A trust document, such as an irrevocable trust, is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries. A trust document is a private document and is not recorded or registered with the state, unlike a corporation or an LLC (limited liability document). Trusts come in two forms: revocable (able to be changed) or irrevocable (not able to be changed). Trusts are mainly used in estate planning but their benefits can also overlap with a business planning and/or estate tax reduction.

There are significant advantages to creating a trust. Specifically, a grantor can stipulate the terms of the trust document in order to have control over their wealth, even after death. A grantor can describe to whom they want their assets to be distributed to as well as the timing for such distributions. Some trusts allow for income and/or principal distributions to the grantor and their family during lifetime. A properly drafted trust can protect the estate from creditors of the heirs’ or from other beneficiaries who may not be capable of handling their inheritances (such as younger children). Also, since trusts are private documents, they uphold the privacy of families. Further, assets properly funded into trusts pass outside of probate. Finally, irrevocable trusts can be utilized (with very specific provisions) to remove assets from a grantor’s estate where their probate estate is taxable (over 5.45 million or double for marriage individuals).

Generally, for an irrevocable trust to be excluded from a grantor’s estate, the trust should be drafted where the trustee has the full discretion whether to pay income and/or principal to the grantor and there is no agreement that the grantor is entitled to any such distributions. Further, it is important to look at the laws in each particular state to determine whether creditors can reach the assets of the irrevocable trust. If creditors can pierce this trust “veil”, then the irrevocable trust may be subject to inclusion in the grantor’s taxable estate. If not, and pending the trust was drafted with the proper formalities, then the irrevocable trust will be excluded. For example, when drafted properly, irrevocable life insurance trusts are great vehicles to use to keep life insurance proceeds outside of a grantor’s taxable estate.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.

Tax Consequences of Gifting

Tax Consequences of Gifting

Not many people realize that gifts may sometimes bear gift tax consequences. In general, a gift is considered taxable if it is in excess of the annual exclusion limit. The annual exclusion limit is currently $14,000.00 per year. If you are married, you may double the annual exclusion to $28,000.00. If a gift exceeds the annual exclusion limit, then a gift tax return must be filed with the IRS and taxes paid in some circumstances.

Although a gift may be considered taxable, it doesn’t mean that gift tax will always be due. Gift taxes are only due when the total gifts made exceed the lifetime exemption amount. The lifetime exemption amount for 2016 is 5.45 million dollars. Each year, however, congress reserves the right to raise or lower that exemption amount.

If the taxable gift exceeds the lifetime exemption amount, then the gift will be taxed at the maximum gift tax rate in effect (approximately 40% currently). For example, if you make a gift of 6.45 million dollars to an irrevocable trusts, for the benefit of your children, then the gift tax would be applied only to 1 million dollars, which is the excess of the lifetime exemption amount. Further, any future gifts will incur gift tax if they exceed the annual gift tax exclusion limit for that year.

Further, there are certain gifts that are not taxable regardless of their amount. These gifts are as follows:

  • Gifts that do not exceed the annual exclusion for the calendar year;
  • Tuition or medical expenses you paid directly to a medical or educational institution for someone;
  • Gifts to your spouse (for federal tax purposes, the term “spouse” includes individuals of the same sex who are lawfully married);
  • Gifts to a political organization for its use; and
  • Gifts to charities.

In order to maximize estate and gift taxation benefits, individuals should utilize their lifetime gift exemptions, spousal portability rules, annual exclusion limits and non-taxable gifting options.

Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.