The purpose of the estate planning process is to help conserve as many of your assets as you can in order to pass them on to your beneficiaries in Alpharetta. This includes planning to potentially avoid probate and even to avoid estate taxes. Georgia does not impose its own estate tax, which means the only one that you need to be concerned about is the federal tax. As many of those that we here at Hill & Watchko, LLC are surprised to learn, through careful planning even that can be avoided.
You are already entitled to a federal estate tax exemption. Per the Internal Revenue Service, the exemption threshold for 2020 is $11.58 million. As long as the total taxable value of your estate is below that amount, it will not be subject to tax. This elevated threshold amount means that very few estates will actually end up being taxed. There is a way, however, for you to optimize your exemption to protect even more than the threshold amount.
The unlimited marital deduction allows you to leave your spouse a financial gift of any amount without those funds being taxed. Thus, if you choose to leave your assets to your spouse upon your death, you preserve the entirely of your estate tax exemption. Your spouse can then file an estate tax return after your death claiming portability, which allows them to combine your unused exemption amount with theirs. This pushes the threshold to $23.16 million for them, allowing all of those assets to be passed on to your children, grandchildren and other kin tax-free.
You can learn more about optimizing your estate planning by continuing to explore our site.