A recent Associated Press article on the Estate Tax provides some basic background information. Read the rest of the article, with more questions and answers here. Q: What assets are included in an estate? A: The federal estate tax is calculated by adding up the fair market value of what you own — cash and… Read More
Valuation, Timing, and Michael Jackson
Today I am going to use the Michael Jackson case (yet again) as an example to discuss the important issue of timing when determining the value of assets included in a Decedent’s estate for estate tax purposes. As I’ve written before, the estate tax generally is imposed upon the value of a decedent’s estate at… Read More
Are Michael Jackson’s Funeral Costs Deductible for Estate Tax Purposes?
One of the blogs on my daily reading list is the “Tax Girl” (a/k/a Kelly Phillips Erb, a Philadelphia tax attorney). She has a regularly occurring feature on her blog called “Ask the Tax Girl” which she uses to answer readers’ tax questions (and sometimes, when necessary, gives her readers the motherly advice that they deserve… Read More
Estate Tax Legislation in 2009: Avoiding the Train Wreck
Beth Shapiro Kaufman of Caplin & Drysdale recently published an article in Estate Planning Magazinerecently published an article in Estate Planning Magazine entitled “United States: Estate Tax Legislation In 2009: Avoiding The Train Wreck.” In it, she discusses the fact that the estate tax is scheduled to disappear next year and come back with a vengance… Read More
Valuation — A Critical Component of Estate Planning for the Wealthy
As I have previously written, the estate tax is imposed upon taxable estates of more than $3,500,000. Any amount over $3,500,000 is currently taxed at the rate of 45%. As an estate planning attorney, my clients generally fall into one of three categories: People whose assets are far below the lifetime exemption People whose assets… Read More
Non-Tax Reasons for Leaving Property in Trust: Control and Protection
In my last couple of posts I explained that if Michael Jackson left assets to his mother Katherine in trust, a trust with certain specific rules, then upon Katherine’s death, those assets would not be subject to the estate tax a second time. If Jackson engaged in proper estate planning, then he could accomplish his goal… Read More
Why Assets Should Be Left in Trust -The Estate Tax
In my previous post, I speculated that the published reports stating that Michael Jackson left 40% of his estate to his mother Katherine Jackson, 40% to his children and 20% to charities was not, could not be entirely accurate. Although I have not seen it the Michael Jackson Family Trust document, I am sure of the fact… Read More
Michael Jackson and the Estate Tax
I have previously written in the blog about the Estate Tax, but I’d like to revisit the subject using the real life example of the Michael Jackson estate. First, some review of the basics. The estate tax, which is often, but inaccurately called the “death tax” by people who oppose it, is not an income tax. It… Read More
Michael Jackson’s Will Filed with Court
Here is the link to Michael Jackson’s Last Will and Testament. The will is what’s known as a “pourover” will. In other words, instead of the will itself disposing of all of his assets directly, it instead transfers all of his assets to the “MICHAEL JACKSON FAMILY TRUST” as amended and restated on March 22,… Read More
Long Term Estate Tax Reform Unlikely in the Coming Year
This past weekend was the annual conference of the American Bar Association Section on Taxation. At one of the sessions focused on the estate and gift tax, aides to Senate Finance Committee Member Charles Schumer (D-NY) and John Kyl (R-AZ) appeared jointly. According to Sen. Schumer’s aide, there will much more likely be a “patch”… Read More