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Advance planning can help you avoid costly estate tax mistakes.


Estate taxes are confusing for nearly everyone. The more involved and extensive your estate is, the more likely they are to be even more confusing. Many residents of New York will be subject to both New York state and federal government estate taxes. Generally, only estates with values of more than $1 million will be subject to estate taxes.



Recent changes in New York law mean exemption amounts will change annually up through the year 2019. It is estimated that by 2019, the New York and federal exemptions will be the same. It is also important to note that what you leave to your spouse is exempt from most state and federal taxes. However, you should also know that without a proper estate plan, your non-spousal survivors may wind up paying a significant portion of your estate on taxes.


What gets included?

When your executor lists your assets for tax purposes, you may be surprised at what must be included. Even assets that have been transferred into a living trust and assets that have named beneficiaries must be included in the total estate for taxation purposes. This means your executor must make a catalog of:

  • Any funds in any type of bank account including checking or savings

  • Funds deposited in certificates of deposit

  • All real estate holdings

  • All retirement account balances

  • Anticipated life insurance proceeds

  • All mutual fund and brokerage accounts

  • Personal vehicles

  • Recreational vehicles

  • Personal belongings including jewelry, art, etc.


When your gross estate exceeds the exempt amount at the time of your death, your executor will be required to file a New York State estate tax return as well as a federal estate tax return with the state. It is important to understand these filings are required even if the estate is not large enough to require filing with the Internal Revenue Service. Final returns and any tax payments due must be completed nine months after death. In some cases, executors may request an extension from the state, and taxes may also be paid in installments when necessary.


Mistakes on estate tax returns can be very costly if additional taxes and penalties are added on after the fact. One way to help the executor of your estate is to keep a detailed accounting of all of your assets. This accounting should be updated on a regular basis to reflect any assets that were sold, or any new assets that were purchased.


As part of your estate planning process, we can help you create a detailed inventory of all the assets that may be subject to New York state or federal estate taxes. In addition, if you are an executor of an estate and need help preparing New York or federal tax forms, we can help as well.


Regardless of whether you are planning your estate or you are administering another person’s estate, contact Solomon Richman, P.C. for help with all New York and federal estate taxes. You can schedule a consultation by calling us at (516) 437-6443.

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