Determining Federal Estate Taxes in DC

Following the death of an individual, it is important to determine federal estate taxes in DC. Prior to administering the estate to beneficiaries, estate taxes must be paid. However, as it can be difficult to know what must be included in the valuation of the estate, it is important to work with an experienced professional. A well-versed attorney can help you determine what federal taxes are owed.

How Does Someone Determine the Taxable Estate?

The gross taxable estate is comprised of all of the assets the decedent had in their control at the time of their death regardless of ownership or titling. This would include any bank account regardless of whether they have a joint owner or a payable on death beneficiary. This also includes any vehicles, brokerage accounts, real estate, stocks, bonds, artwork, jewelry, cash, or life insurance. All assets that have not been permanently given away prior to death are included in the gross taxable estate.

Estate tax attorneys take a snapshot of an individual’s assets as from the date of death and determine their market value on the date of death. That determines whether the estate meets either the DC or the federal estate tax exemption.

Understanding Federal Estate Tax in DC

If an individual dies above the federal estate tax exemption, an estate tax return and all taxes will have to be filed within nine months of the date of death. However, they can get an automatic six months’ extension to file the return but still must pay the taxes at nine months from the date of death. An attorney can help the personal representative of the decedent make an inventory of all the assets and begin to obtain all necessary date of death evaluations.

Attorneys will have any real estate, vehicles, jewelry, and artwork appraised. Internally, they will value any stock holdings and begin to determine the gross taxable estate to understand whether an estate tax return is due. In addition, attorneys look towards what deductions may be available to take from the estate tax return to lower any liability. Deductions may include mortgages, debts the decedent owned, funeral expenses, marital deduction, and charitable deductions.

It is important to note that, if an individual is over the federal estate tax return filing threshold, they are likely over the DC estate tax filing threshold since the DC threshold is much lower than the federal threshold. That may mean an attorney also must file a DC return in addition to a federal return. It is also important to note that real estate in other jurisdictions may have a different filing threshold than DC or the federal government. In these cases, an attorney should also file an estate tax return in those jurisdictions as well based on the other value of the gross taxable estate.

Get Help Determining Federal Estate Taxes in DC

It is important to determine what federal estate taxes may be owed in DC. A well-versed attorney can help. Call today for a consultation to get started.