What are the tax implications of estate planning?

The tax implications of estate planning in Utah can be complicated, depending on the size and complexity of the estate. Estate taxes are the taxes imposed by the state on the transfer of wealth from one person to another upon death. In Utah, the estate tax rate is 6.85%, and the exemption is $5.5 million. At the federal level, the Tax Cuts and Jobs Act of 2017 changed the estate tax exemption to $11.7 million per person and $23.4 million per married couple. This means that if the value of the estate is less than these amounts, there would be no federal estate taxes due. The other tax implication of estate planning to consider is the gift tax. The federal gift tax rate is 40% and is reduced by any applicable gift tax exclusions. In Utah, gifts up to $15,000 are exempt from the gift tax. Also, if a person makes a gift to their spouse or a charity, those gifts are exempt from the gift tax. The final tax implication of estate planning to consider is the income tax that the estate may owe. In Utah, the estate will be liable for income taxes on any income it earned prior to the death of the decedent, such as interest, dividends, or rental payments. The estate may also be liable for capital gains taxes if the estate sells any of its assets, such as real estate or stocks. Overall, estate planning can have significant tax implications, and it is important to consult with an estate planning attorney before making any decisions. An estate planning attorney can help you understand the types of taxes that may be due and provide guidance on how to best structure your estate plan to minimize taxes.

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What are the tax implications of estate planning?

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