The end of the year is coming and it's a perfect time for those who have assets to appoint beneficiaries and keep up-to-date on new laws. Estate planning plays a vital role in the future of Texas consumer's assets. For those who already have a plan in place, it can be important to review and update pertinent information in regard to tax changes.
There are two types of changes when it comes to estate tax, which include gift tax exemption and lifetime estate. The benefit to these changes is the exemption from taxes that are documented as gifts up to $5.34 million when 2014 arrives. Also, these estates are transferable to a surviving spouse with the benefit of an exemption increase of $8 million without tax implications. Another tax change is affiliated with the Affordable Care Act, called net investment income tax.
This law involves married spouses who have an annual income of over $250,000 and those who are unmarried with an annual income of over $200,000. Also included are those who are business owners or beneficiaries of trust funds. Their incomes will be subject to a 3.8 percent tax. However, those who have trust funds are held liable for less than the stated increase if it generates less than $11,650 per year.
Proper estate planning can make a difference in the amount of tax a person is subjected to paying. Each year, Texas laws may change in regard to taxes on estates, trusts and investments. Reviewing important documents can help an individual be prepared for the upcoming year and ensure they receive the best possible outcome for their estate plans.
Source: The Daily Progress, CBJ: Time to check the list for financial and estate planning goals, Carol Hazard, Dec. 16, 2013