Fundamental Information Regarding Inheritance Tax
Inheritance tax is a tax that imposed on someone who is no longer alive. And this includes all the property and related possessions, as well as the cash the deceased acquired while they were alive. If you look to managing the inheritance tax of your deceased relative, and you have never done this before, you should see to it that you are informed so that you make sound decisions.
In essence, you need to put into perspective two primary aspects so that you can deal with your inheritance tax. Typically, it is the state that determines the threshold, and this has to do with the attitude of who is in power when it comes to inherited wealth. At the moment, the inheritance tax threshold stands at 325,000 per person that is as from April 2016.
To begin with; you should ensure that you list out all of the deceased’s assets, and more crucially, consider the exact value of the same at the date of death. Be sure to remove all the liabilities and the debts. What’s more, you need to see to it that you keep a clean record of how you arrived at the values that you have noted; it should offer that impression of an estate agent’s valuation.
You see, the tax authorities may want to see your records even twenty years later after your inheritance tax has been paid. Assets such as money in the banks, land, jewelry, cars, shares, property, insurance pay-outs, jointly owned assets must be included. Gifts in form of assets and cash should be included, especially if they were given seven years before the departure of the person in question.
There is every reason to tax anything that benefitted the person. Liabilities and debts reduce the value of the deceased’s chargeable estate. They may include credit card debts, some funeral expenses, household bills, mortgages and even gambling debts.
And then there is the issue of who should shoulder these inheritance taxes. Most of these questions are left in the will of the deceased. In cases where death happens without a warning; and there is no will, it is the administrator who does this.
You may be wondering if you have a chance to reduce or minimize the inheritance tax. And this is possible. However, you need to ensure that you seek services from a professional that has the requisite experience and competence. And you have all the legal rights to make use of the gifts that are available. Remember that this aspect works of you had received these gifts 7 years before your departure. It is after the elapse of these seven years when every exacting criteria will applied. If you do not know how to do this, you may have to hire a probate lawyer.