Tax write offs
However, both the will and living trust, when properly written and with advice on the proper ownership of assets during lifetime, may include estate tax avoidance techniques that may save substantial tax dollars for the benefit of the family. tax write offs Alabama-income-tax. Will having a living trust avoid challenges by my beneficiaries or heirs?Disgruntled heirs or beneficiaries can challenge the validity of a living trust on legal grounds similar to those available for challenging a will. It may be alleged that a living trust is invalid because the grantor was incompetent at the time of establishing the trust or was unduly influenced by some person to establish the trust in a particular manner. Further, although the time period for challenging the validity of a will can be limited to four months, there may be a much longer time period under which the validity of a living trust can be challenged. tax write offs Tax-tables. The cost of defending the validity of a will, where the executor acts in good faith, is payable from the probate estate. It is not clear under Ohio law whether similar expenses in defending the validity of a living trust would be borne by the trust assets or by the trustee personally. What are the advantages of a living trust compared to probate?Compared to probate, there are many differences, but also some similarities in the manner in which property is administered in a living trust following the death of a grantor. tax write offs Tax rates. Among the characteristics of administration of a living trust that a person may find desirable are:Privacy. The terms of a living trust are contained in a private document, while the terms of a will, including beneficiary designations, become a matter of public record once the will has been filed with the probate court. In addition, other information filed with the court during the probate process, such as the inventory of assets and the written account of all receipts and disbursements of the estate, also become matters of public record. The administration of a living trust is generally not made public. Control. The absence of any requirements to file a will or any other reports with a court increases the independence and control of the trustee, relative to an executor. Lower costs. Some publications make extravagant claims about the extent of the costs of the probate process. The typical components of cost in the probate process are:Court costsAppraisal feesExecutor. s commissionsAttorney feesWhile court costs will vary with the activity in the estate, presently a typical cost range will be $150-$225. A living trust would not bear these costs. Appraisal fees will typically be incurred in probate for real property, and may be incurred for other . hard to value. assets, such as expensive artwork or closely held corporations. These costs would typically not be required by a living trust. If, however, the decedent. s assets are of such value that an estate tax return must be filed (which will almost always be the case), it may be prudent for the trustee of a living trust to secure appraisals of those assets to help establish value for estate tax purposes. Appraisals also aid in establishing the basis of the assets for federal income tax purposes. Executor. s commissions are set by state law and are based, generally, on a percentage of the value of the assets of the estate. At present, the commission varies between one and four percent of the value of the assets (combined with the income on those assets) depending on the nature, amount and title of the assets at death. However, surviving spouses and other family members often serve as executor and may waive these commissions.
Tax write offs
Publications || Alabama-income-tax || Tax write offs || Ohio-tax