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Sunday, September 11, 2011
Law - Estate tax issues has turned out to be terribly complex for some
This Dec. 17, 2010 column by Paul Sullivan of the NY Times was headed "Law - "Estate Tax Will Return Next Year, but Few Will Pay It"." But this long column yesterday by Mr. Sullivan was headed "In Agreement on Estate Taxes, Even More Complications." Some quotes:
FROM a tax perspective, dying last year seemed a simple proposition for the wealthiest people in America: their assets would pass to their heirs free of federal estate tax because the tax had lapsed.But for some of these estates, the tax issue has turned out to be incredibly complex.
The reason is the terms of the agreement reached last December by President Obama and Congressional Republicans. The two sides agreed that the estate tax for 2011 and 2012 would exempt the first $5 million in assets per person and that any assets above that would be subject to a 35 percent tax rate. (Had they not reached that agreement, the exemption this year was set to be $1 million and a 55 percent tax rate.)
But instead of trying to impose the tax retroactively on the assets of people who died in 2010, the agreement allowed executors to make a choice: they could file an estate tax return under the new law or they could opt out. But in opting out, the people who received the assets would have to pay a different set of taxes when they sold those assets.
And the deadline for making that choice is coming up soon — Nov. 15. * * *
And that doesn’t even count the second problem. With only 10 weeks left to decide what to do, the one tax form needed to opt out of the estate tax, No. 8939, has not been issued yet by the Internal Revenue Service.
Posted by Marcia Oddi on September 11, 2011 07:04 PM
Posted to General Law Related