What is an estate tax return and why should I file one?

An estate tax return is a document that is filed by the executor of an estate after someone passes away. The purpose of this return is to report the value of the deceased person’s assets and liabilities (what the person owned and owed) to the state of Michigan. The estate tax return is then used to determine how much, if any, taxes the estate owes. In Michigan, a return must be filed for any estate valued at $3,500 or more. Filing an estate tax return is important because it is necessary to transfer title to the property in the name of the deceased person’s beneficiaries. Without filing an estate tax return, the executor has no legal authority to manage the estate. Additionally, the return helps to ensure that the estate pays all the taxes it owes. If an estate is subject to taxes, they must be paid before any assets can be distributed to the beneficiaries. Filing an estate tax return can take a lot of time and effort, but it is an important step in the estate planning process. In Michigan, executors have 10 months from the date of death to file the return. Even if the estate is not subject to taxes, filing the return is necessary in order to transfer title of the assets and close out the deceased person’s estate.

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