What Do State and Federal Estate Tax Laws Mean for Your California Will and Estate?

1:01 am Uncategorized

While each state has its own estate tax laws, the federal estate tax has not typically posed a problem for those whose estates fall below the $3.5 million dollar mark. That means if your estate falls below this number, your heirs and other beneficiaries of your estate will receive their shares of your estate without having to pay federal taxes.

But this limit may change as we enter 2010.  Many speculate that the US Congress will attempt to continue the existing $3.5 million limit for at least a minimum of one year and may be successful in keeping the minimum at this amount for a few years more. But there are no guarantees.

Perhaps the best thing you can do when planning your estate is to know what the state of California estate tax laws are at the time of your estate planning. Many states have very different estate taxation laws. In some instances, the state laws stipulate limits that are lower than federal laws. Talk to your California estate planning lawyer to ensure that your state laws won’t negatively impact your estate by heavy taxation.

Many states use their own tax on estates as a way to increase revenue in the wake of the federal limitation of $3.5 million. Until 2005 many states collected from the federal tax gained from an estate — with the limit in place, most states no longer collect a portion of the estate tax. As of 2005, California  does not collect an estate tax separate from the federal government. Inheritance tax in California was eliminated in the early 1980s. That said, it’s important for you to check with your California estate planning attorney as to what the current federal and state laws are whether your estate falls above or below the $3.5 million mark.

Contact us today and let our Newport Beach law firm help you with all your financial planning needs.

Leave a Comment

Your comment

You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Please note: Comment moderation is enabled and may delay your comment. There is no need to resubmit your comment.