For decades, CBM’s experts have overseen the complexities of estate and inheritance taxation in compliance with federal and state requirements. Clients rely on us to help prepare returns for income-generating assets held in trust for a future beneficiary. And when a family member or other loved one passes away, CBM can ease the burden for a client’s trustee, personal representative or estate attorney by collaborating on fiduciary matters and finalizing important tax matters.
Of course, taxation in estate planning can be especially challenging without knowing the full value of an individual’s estate assets but, in this area too, CBM delivers the necessary expertise. Our certified valuation analysts can assist in gathering and determining the full value of an estate. Beyond helping to determine the tax liability of an estate, our team can also represent your interests in the event of a dispute about your tax liability with the IRS or state tax authority or in the courts should you enter into a business dispute with another party.
An estate tax return, Federal Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, must be filed for any U.S. Citizen or resident alien if the gross estate of the decedent exceeds the filing threshold for the year of the decedent’s death. For decedents dying in 2022, the exemption is $12.06 million. In addition, there is a way for spouses to combine their exemption from estate and gift taxes by filing Form 706 for what is referred to as “Portability” between spouses. CBM works with numerous clients and their attorneys to determine any potential filing requirements or to determine if there are any estate tax benefits available due to Portability.
Estate and inheritance taxation at the state level is often more complicated. Each state and the District of Columbia have different rules and filing requirements. CBM has an experienced team of professionals that are well-versed in ensuring compliance with all state tax laws.
Domestic estates and trusts are separate taxable entities. The fiduciary of a decedent’s estate or trustee of a trust files Form 1041, U.S. Income Tax Return for Estates and Trusts, to report income, deductions and gains and losses for the estate or trust to both the IRS and any beneficiaries. CBM collaborates with hundreds of clients and their attorneys each year to be sure the executor or trustee is in compliance with both federal and state income tax filing requirements.
If your wealth planning strategy includes gifting within your family, now is the time to take advantage of unusually low transfer taxes thanks to the Tax Cuts and Jobs Act. The transfer tax exemption doubled at the end of 2017 to $11,180,000 for an individual (or $22,360,000 for married couples). The exemption increases with inflation until December 31, 2025, when the TCJA sunsets. The increase in the exemption has created significant estate planning opportunities for gifting wealth to children or grandchildren. The exemption amount is set to drop back to the pre-Tax Cuts and Jobs Act level once these provisions sunset at the end of 2025, which means only 50% of today's exemption amounts. Don't wait until it's too late. Contact CBM to let us help you take advantage of this unique estate planning opportunity.
CBM’s financial planning team can also help you develop a tax-savvy strategy for establishing your estate as part of your broader financial plan. CBM’s certified financial planners are available to consult with you in the areas of gifting, education and retirement planning, charitable giving, insurance, the generation-skipping transfer tax and the distribution of assets of beneficiaries.
And because estate plans may also be a priority for business owners considering the succession of their business to new ownership including for family-owned businesses, our professionals have the experience to consult as professional and personal matters intertwine.
If one goal of your estate planning strategy is effectively managing your wealth, you may consider seeking a financial advisor. May Barnhard Investments, CBM’s wealth management subsidiary, provides you with a unique, comprehensive approach to wealth management that combines financial planning and tax planning with investment advisory expertise.