After your death, you want as many of your assets as possible to pass to your heirs, rather than being paid to the government in estate taxes. While Florida does not have its own estate tax, the federal government does assess a tax on estates over a certain value, which may change based on new laws passed by Congress. Estate tax portability can help married couples in Coral Gables and around Florida protect more of their assets and avoid taxes.
Estate tax portability notes that a surviving spouse can use the unused portion of a deceased spouse’s federal estate tax exemption, effectively doubling the amount a couple can shield from estate taxes. Ultimately, that means more of those assets pass to the couple’s heirs.
Estate tax portability does not occur automatically. Instead, the executor of the estate of the first spouse to die must file IRS Form 706 within nine months of death, unless an extension is applied for that can provide them with more time to make those essential decisions. If the executor misses that deadline, the surviving spouse may miss out on the opportunity to take advantage of portability.
There are several key benefits of applying for estate tax portability. However, it’s important to carefully consider the right decision for each individual.
Working with an estate planning lawyer can help individuals understand the potential benefits of opting in to estate tax portability and whether they make sense for their individual needs.
While there are many potential advantages to estate tax portability, individuals in Coral Gables who are planning to opt in should carefully consider the drawbacks, as well. First and foremost, failure to meet the IRS’s filing deadlines can mean that a surviving spouse no longer has the option to file for portability, which can mean significantly increased costs.
Furthermore, if the spouse remarries and their new spouse dies first, there may be loss of exemption depending on how the estate plan was set up. In some cases, that may mean that they have passed on much higher estate tax costs than anticipated. Finally, portability does not apply in all cases, including wealth passed on to grandchildren or other future generations.
Working with a legal professional can help individuals who are considering portability of estate taxes make the right decision for their specific needs.
Whether you are engaged in estate planning or you have recently lost your spouse and need to make decisions about their estate, a lawyer can help you understand the impact of estate tax portability, including not only how it could apply to you, but what challenges your heirs may face in the future. If you need to know more about estate tax portability in Coral Gables, Veliz & Associates, P.A., can help. Contact Ana M. Veliz today to learn more about this crucial aspect.
We evaluate your case and determine how we might be able to help.
We will meet with you to discuss your next options and lay out a plan.
Our team guides you throughout the process so you feel confident about your choices.
(305) 250-9917