Losing a loved one is difficult no matter when or how it happens. When that individual fails to leave behind a complete estate plan, estate taxes can kill beneficiaries financially. This week, this column will briefly go over Connecticut's current estate tax laws. These laws are frequently changing, but an experienced attorney will be able to provide any updated information.
In order for an estate to be taxed, its value has to be at a certain point. Currently, for an estate to be taxed, its value must be at least $2 million. So, for those with estates valuing less than that, taxes -- outside of the deceased's state and federal taxes that still must be filed -- on the estate may not be a big worry.
For those estates that are subject to taxation, certain forms must be completed and filed both in probate court and with the Connecticut Department of Revenue Services. The forms needed are the Form CT-706/709 and the Connecticut Estate and Gift Tax Return. These forms can be found online or they can be obtained through an attorney. One thing of special note is that assets that are transferred to a surviving spouse are not considered taxable.
Estate planning really is key to minimizing estate taxes. How assets are distributed, transferred, placed in trusts or whatever one chooses to do will have a direct effect on how much beneficiaries may lose by having to pay Uncle Sam. An experienced tax and estate planning attorney can assist Connecticut residents with preparing their estate plans so that estate taxes do not ultimately break the bank.
Source: thebalance.com, "Learn About Connecticut Estate Tax Laws", Julie Garber, Accessed on Sept. 21, 2017