A study of gift and estate tax issues There are some issues in gift and estate tax in the United States, especially for those who have a lot of money to give to their relatives or other people before they die. Before going into detail about those issues, we should understand the meaning of a gift and estate tax. According to Internal Revenue Service, a gift is “Any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money’s worth) is not received in return.” The gift tax is a tool that will stop people from giving away all their assets before death thus avoiding having to pay estate tax. Most people will not have to pay estate tax as they do not have the required assets; however, some people …show more content…
Ebeling’s (2016) study found the following:
For 2017, the estate and gift tax exemption is $5.49 million per individual, up from $5.45 million in 2016. That means an individual can leave $5.49 million to heirs and pay no federal estate or gift tax. A married couple will be able to shield just shy of $11 million ($10.98 million) from federal estate and gift taxes. The annual gift exclusion remains at $14,000 for 2017. (para 1). How can we avoid those limitations? There are some strategies to deal with those issues, such as educational gifting, medical gifting, family gifting, and charitable organization gifting. In addition, almost every gift is not subject to the gift tax because of exemptions on gifts to charitable organizations, educational institutions, and others that serve the public good
…show more content…
Third, the donor should stay in control of a 529 plan account. With some exceptions the beneficiary has no legal right to the money deposited into the account, so one can make sure the funds are being used for what it was intended to be used for. Furthermore, an account owner of a 529 plan can withdraw the money at any time and use it for what ever he/she wants to use it for, but the earnings on the funds will be subject to income tax at a rate of 10% penalty. Fourth, these plans offer low maintenance and are very hands off when saving for college tuition, and these plans allow people to automatically make contributions from their pay check to their bank. The ongoing management of your 529 accounts is most often handled through an outside investment firm. Fifth, contributions on 529 plans reporting do not have to be reported on federal income tax forms, and people will not receive a 1099 to report taxable income until the year they make a withdrawal. Deposits on these plans, up to $14,000 per individual and $28,000 for a married couple filing jointly, will qualify for the yearly giving tax exclusion. Next, these plans are very flexible, and people can change their investments in these plans two times per year. They also can rollover your funds into another 529 plan once a year. One can replace the beneficiary with another qualifying member of the family at the same time. Finally, anyone can take advantage of a 529 plan, and the
On September 12, 2014, Denise Rockett filed a complaint against Eugene Nigro, Esq. Nigro was reportedly negligent when handling legal matters in her late husband’s estate. Specifically, the complainant alleges that Denise, as Executrix of her late husband’s estate, was intentionally excluded from major decisions, not properly compensated, and deprived of control over their properties. Nigro allegedly breached his fiduciary obligation and violated Mass.R.Prof.C. 1.4(b), 1.7(b), and 8.4(c).
Blaise M. Sonnier, J.D., DBA. (2012). Circular 230: Its Day-to-Day Impact on Tax Practices. Retrieved October 12, 2016, from http://www.thetaxadviser.com/issues/2012/feb/tpr-feb12.html
... constant today. In earlier times the social purpose of a gift was to either solidify a military alliance or to secure protection from greater powers. Now the social purpose of a gift is to express thanks or, as in ancient times, to solidify a friendship. However, the transfer of wealth upon ones death to loved ones, friends and charities through a legal Will is almost identical to the bestowment of treasure Beowulf exercises upon his death. Andrew Carnegie one of the wealthiest men of the modern era mirrors the Anglo-Saxon gift giving sentiment in his quote, “The kept dollar is a stinking fish…the man who dies rich, dies thus disgraced.” It is interesting that the ideals employed many years ago are still such an important part of modern society. Ideals that transcend the barriers of history are those with the most validity and integration within society.
“The Inheritance of My Father: A Story for Listening” comments on the issues of family ties, identity and belonging in relation to hybridization. Roemer’s purpose involves the highlighting of the relationship between finding one’s identity and finding one’s voice. He achieves this by allowing the readers to embark on a journey of self-discovery with the child narrator Bonkoro, who changes from a docile, almost voiceless “child” before the summer vacation to a renewed, confident and articulate “adult” at the end of her vacation. This short story is a unified and coherent production since several aspects of Roemer’s craft testify to the intimate interrelation of finding one’s identity and one’s voice. Roemer emphasizes the theme of self-discovery
The “Fairness of Taxation or Wealth Tax” is where taxes are calculated by the net worth of the person or the couple (household). This would be hard for tax collectors to determine each and every component of net worth of a person.
The federal income tax is broken up into different groups based on a tax payers marital status. Taxpa...
However, as may be expected from our modern society, the custom of giving gifts quickly turned into the practice of exchanging them. If one gives gifts to loved ones at Christmas, the reasoning goes, then those who do not receive gifts from a person are obviously not loved by him/her. So each individual now is required to give a gift to all of his/her friends, or risk communicating to them that s/he no longer loves them -- or perhaps never did! Also, there arises another problem when someone gets a gift from a person to whom they did not give one. The logic here is that the one who gave the gift obviously has a greater love for or places a greater value on the friendship than the one who did not. A decidedly awkward situation arises from this, one can imagine.
According to the Association of Fundraising Professionals, in countries that offer tax breaks for those who make financial donations to charities, the percentage of people who donate is on average 12% higher. Tax incentives also prompt more giving no matter the economic development of the country. No matter how poor or rich the country is, if they offer a tax incentive to those who financially give to charities or non-profits, a higher percentage of individuals donate. Domestically, states have found that restricting or removing existing tax incentives regarding charitable donations significantly decreases the financial support of those charitable
One might argue that a higher quantity of donations will change the lives of the largest number of people, but it will be useless if it doesn’t get to its intended recipients. Whatever someone can spare will be enough. It is also easier to convince people to do something willingly of they know they aren’t obligated to. In To Kill a Mockingbird, Atticus isn’t forced to defend Tom Robinson in court, but he does so anyway. This shows that when people feel they have some degree of freedom, they will most likely do the thing.
One cannot simply tell someone else how to spend their money, even if it is what’s best for the village. Money is a sensitive issue. Donors feel as if “it’s my money I spend it how I like” and they have every right to put their hard earn into whichever program the see fits best. Yes, giving the money to a program that has a very nice size budget would not be ethically good if it is a department that has a tight budget, but that department needs to find other ways to get donations and grants. So that they can produce high earning alumnus that gives
A gift is the transfer of legal property such as land, a house or money. Since there is no consideration for the gift, a gift is not regarded a contract and as such a gift will fail if the person giving the gift does not take the necessary steps to divest himself from the gift. Where a gift fails it reverts back to the person intending to make the gift or to the estate of that person where the gift is testamentary. A completely constituted trust implies that the trust property is conferred to the trustees and the trust is binding on the donor who cannot revoke the trust. When the trust property is not properly vested the trust is considered incompletely constituted and it is void as equity will not force the donor to complete the trust.
In the book, The Stakeholder’s Society, Bruce Ackerman and Anne Alstott come up with an idea that every American, once they enter college, or the moment they turn twenty one will receive 20,000 dollars every single year for four consecutive years. In the book, Ackerman and Alstott claim that you are free to spend this money however you see fit. However, once the money is gone, then that is it. Ackerman and Alstott explain further in that the program will be funded by a “wealth tax”. This program will be paid for by contributions from deceased program beneficiaries in the amount of 250,000 dollars.
...themselves to think of that statement alone, they would remember that accepting or giving said gift, would only benefit themselves and not the better good of the student, so it should not be done.
We live in a culture where people are expected to give to others gifts of gratitude and expressions of love. Sometimes these gifts are accepted for what they are worth and other times they are not. We use that which others give us based on several factors. Among them are whether we perceive the gift as valuable, whether we can practically use the gift, or whether the gift is given earnestly and for the right reasons. Because of this there is not one explanation why certain attitudes about gifts exist. We should, however, understand that it is not for us to realize why a gift is given, but rather that someone thinks enough of us to give a gift in the first place. It is certain that if gifts are not accepted and used in a prudent and expeditious manner, then the gifts that are received will deteriorate or whither completely away.
America is a land filled with strong nationalism; however, there was once a time where one living in America could not say that he was an American. The colonists in the New World did have nationalism, but it was for a land across the sea. In Robert Frost’s poem “The Gift Outright”, there is set forth a stanza concerning the history of America and how this nation came to be. Through his use of personification and other stylistic choices, Frost efficiently communicates and explores the forming of a nation and, thus, the creation of nationalism.