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Estate Tax Planning

As client advocates, with outstanding tax law knowledge, protecting the assets and the rights of our clients takes first priority.

Did you know that in addition to the income taxes you pay each year, there is a federal and state estate death tax?  This is a one time tax at death.  The estate tax is designed to tax the wealthy.  A taxpayer is allowed a specific amount of exemption.  The taxpayer determines the value of his or her gross estate on the date of death. Each year the exemption is different.  The federal estate and gift tax exemption includes the gross estate at death plus any gift made during lifetime.  For 2020 it is $11.58 million per taxpayer that dies in 2020.  Each year the exemption goes up by inflation until 2026 when the current estate tax law will sunset and go back to $5,000,000 per taxpayer, unless congress and the president changes the law.  

Oregon estate tax returns are required when a taxpayer dies with more than a gross estate of $1 million.  For Oregon the tax rate is approximately 10% which gradually increases as the total taxable estate increases.  In Oregon there is no gift tax law. Therefore, the Oregon estate taxes only include what the deceased person has at the date of his or her death and does not add back gifts made during lifetime.

Understanding Estate Taxes

Did you know that holding all your assets joint with rights of survivorship with your spouse will not provide you with the proper estate tax planning as a revocable trust would?   In other words, a married couple can shelter $2 million from Oregon estate tax by utilizing both spouse’s $1 million Oregon estate tax exemption.   In the trust, there are specific terms required by the tax code to utilize both spouse’s estate tax exemption.  If the surviving spouse automatically receives the assets upon the death of the first spouse, the first spouse’s exemption will be lost. 

If you are concerned about federal or Oregon estate taxes, call our CPA or one of our attorneys for a free 15-minute consultation.

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