Estate Planning |
Federal and State Estate Taxes

Generally, most estates are not subject to estate taxes, given the current $5,000,000 unified exemption that can be applied towards any federal tax due and the current $1,000,000 in Massachusetts. As such, if a taxable estate is under $5,000,000 it will not be subject to federal estate tax and if under $1,000,000 it likely won’t be subject to Massachusetts estate tax.

The key to determining if you might be subject to a potential estate tax is knowing what your “gross estate” is. Without knowing that, you cannot determine what your taxable estate is. Under IRS rules, your gross estate is broadly defined to include all probate and non-probate property and, in some instances, can include some gifts made within the three years prior to your death. Generally, the largest contributor to the value of an estate is the family home, investments and valuables, as well as any life insurance policies that one owns (regardless of the beneficiary or beneficiaries). To arrive at your “taxable estate,” you apply deductions to your gross estate, such as debts (e.g., mortgages), estate expenses and the marital deduction. Our Cambridge estate tax planning lawyers have the experience and knowledge in all aspects of federal and state estate taxes; contact us today!

Fortunately, there are many tools that can help plan for and minimize state and/or federal estate taxes. These tools often involve the removal of certain items from your gross estate by placing them into special trusts.

If you think your estate might be subject to estate tax, please contact our Cambridge estate tax planning lawyers today at 781-674-2562 to speak with a Cambridge estate tax planning lawyer about your estate and potential tax consequences.