On Friday, August 25th, Attorneys Candice Joy discusses the various taxes that come up in estate planning.

There are four different types of taxes that may come up with your estate. This will b discussed mainly from an administration perspective.

Estate taxes are a tax paid to the estate and the federal government based on the size of the estate when you pass away. There is no estate tax on any estate less than $5 million in Maryland and less than $12 million federally. If over there are some limited planning options that can help plan for this ahead of time.

Inheritance taxes vary greatly from state to state. In Maryland the tax is 10%, however it is only charged to certain people. For example, your parents, children and siblings would not need to ever pay inheritance tax. However, an ex-spouse, nieces and nephews or friends would need to pay this tax.

Capital gains is another tax that comes up much more frequently. Stocks or your home could fall into this category. Your personal representative or trustee would need to lock in the value of the home from the date of death to keep this from getting out of hand.

Income tax is often forgotten or not thought about, but is a common tax paid by most estates. An income tax return will need to be filed for individuals and trusts.

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