Serving The Healthcare Industry - National Pension Consultants Since 1996

Carlos B. Pargas & Associates, P.A., CPAs

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Estate and Gift Tax Planning

Reliable Estate Planning Services and More

Since there are no legal requirements to do estate planning, many people end up putting it off. The truth is that investing a little bit of time in estate planning can ultimately pay off in lower taxes and administrative costs, increased financial security for your loved ones, as well as your own peace of mind. Tax implications will kick in depending on the value of your estate, along with the federal and state laws in effect at the time of your death.

Know the Value of Your Estate

The value of your home, your personal property, business interests, collectibles, investments, and possibly your life insurance can all enter into your estate taxes. It doesn't take much to find yourself in the taxable estate category under the current tax laws. Use the estate planning calculator provided by Carlos B. Pargas & Associates, P.A., CPAs to help you determine what your estate is worth. Having all of the basic estate planning documents in place will allow you to control your own fundamental financial and personal decisions.

Where There's a Will, There's a Way

Without a will, many important decisions will be made for you by strangers in a court system which could be contrary to your intentions. Keep in mind that a will controls only the distribution of your probate estate. It doesn't control assets that are held in trust, certain joint assets, retirement accounts, or life insurance policies on which you've named beneficiaries. "Knowing your probatable and non-probatable assets" can significantly reduce the cost of your Estate Administration.

Be Prepared for Nearly Anything

Keep an updated list of your insurance policies, bank accounts, investment and retirement accounts, businesses you own, outstanding debt, credit cards, tax-related documents, income sources, and other financial information. In addition, include the names and phone numbers of your accountant, lawyer, doctor, and insurance agent on this list. Granting someone you trust with power of attorney enables them to conduct your financial affairs if you become incapacitated.

Make the Most of Your Financial Plans

A directive to physicians, also called a living will or healthcare directive, documents the medical treatment you wish to receive if you become incapacitated. It lets you name the individuals who you wish to make your medical decisions if circumstances keep you from making them for yourself. Make sure to include your burial wishes and a list of relatives, friends, and business associates to be notified after you pass away.

Protecting You and Your Assets

Keep all of your original documents in a fireproof safe or with your attorney. Put your list of documents and the copies you make of them in a binder at home and make sure to tell your personal representative where the binder is located. Successful estate planning is an ongoing project. Review your plan and personal documents on a regular basis to ensure that they are updated for current tax law and reflect your personal preferences.

Your Personalized Gift Planning and Philanthropy

Current tax laws allow you to give away a certain amount of money each year to as many recipients as you choose without incurring any consequences from gift taxes. Your spouse may also join in this annual gifting, even if he or she is not an owner of the transferred assets. This means that you could transfer twice the exempt amount each year to your heirs and double the annual exclusion yet again by including the spouses of your children. The person receiving the gift does not need to be related to you and these annual gifts do not reduce your estate tax exclusion.

The Gift That Keeps on Giving

You can even make unlimited gifts to pay for another individual's medical expenses or school tuition as long as your payments are made directly to an institution. If you have a property that's not needed for your retirement, it could be a potential candidate for transferring during your lifetime. If it's a large income-producing property, the future income will be taxed to the new owner and not to you. You can make unlimited tax-free transfers to your spouse throughout your lifetime or your estate. Contact Carlos B. Pargas & Associates, P.A., CPAs today to learn more about our accounting services.