Estate taxes and the regulations governing them are complicated. I hold a Masters of Science in Taxation degree and am well versed in the field of estate taxes. Here is some helpful information.
Estate taxes are:
- calculated based on all of the property you own or control at the time of your death. This can include, for example, proceeds from life insurance. This is so although beneficiaries generally do not owe income taxes on life insurance proceeds
- due and payable within 9 months of the date of death. Whether or not your property is liquid (e.g. real estate or a family business) , if you have a taxable estate the IRS and/or Massachusetts Department of Revenue will assess a tax on your estate as of the date of death and payment becomes due in 9 months
- voluntary and can be substantially mitigated, if not entirely eliminated
Massachusetts Estate Tax *
The estate tax is a transfer tax on the value of the decedent’s estate before distribution to any beneficiary.
For dates of death occurring on or after January 1, 2003, the Massachusetts estate tax is “decoupled” from the federal estate tax system. For these dates of death, the Massachusetts estate tax is imposed on estates using the Internal Revenue Code in effect on December 31, 2000. For estates of decedents dying after 2002, the applicable exclusion amount was $700,000 in 2003 and increased to $1,000,000 in 2006. Future changes to the federal estate tax law will have no impact on the computation of the Massachusetts estate tax.
Important Questions About the Massachusetts Estate Tax
I will help you answer the following questions:
- Who must file, and how is it done?
- Who is considered the executor for purposes of the Massachusetts estate tax?
- When must the return be filed?
- Can an extension of time to file be granted?
- Can an extension of the payment due date be granted?
- What happens if the return is late?
- When is a release of lien necessary?
- How can an executor or other fiduciary obtain a release of lien on real estate when there is no Massachusetts estate tax filing requirement?
- What documents must accompany Form M-706?
- How must property included in the estate be valued?
- What property must be included in the gross estate?
- How is the Massachusetts estate tax computed?
- Can the tax liability be adjusted after Form M-706 is filed?