Tampa Unified Tax Attorney
Many people in the Tampa, Florida area make plans to give gifts of money or other assets to family members, charitable organizations, and other entities. Sometimes a person will give this kind of gift while they are still alive, but often, a large monetary gift will get passed through a person’s will when that person dies. To put it another way, you might want to give a gift to someone, and the way in which you give that gift can affect whether it is taxed. Indeed, depending upon the amount of the gift, theIRS could expect taxes to be paid on the gift. Yet the way in which taxes will get paid on a gift, and the amount of the tax, can depend upon something known as the “unified credit” or the “unified tax credit.”
In some cases, people refer to the unified credit simply as “unified taxes.” The important thing to know is that the unified credit can reduce the amount of tax that is owed on certain gifts or transfers of assets. A Tampa unified tax attorney can provide you with more information.
Gift and Estate Taxes in Tampa, Florida
To understand the value and use of unified tax credits, it is important first to be clear about how gift taxes and estate taxes work. There is no Florida gift tax, but there is a federal gift tax. In the present, the IRS generally requires you to report any gift of more than $15,000. There is a lifetime gift exclusion of multiple millions of dollars, which means as long as you make gifts of under $15,000 (per person, per year) and do not exceed the lifetime limit, you may not need to report any gifts you make. Just because you have to report a gift, keep in mind, does not automatically mean that you will owe tax on it.
Estate tax is the tax, according to the IRS, “on your right to transfer property at your death.” At the time of your death, your “Taxable Estate” is determined, and your estate may owe tax on the total amount. Here is where the unified credit comes into play.
What is a Unified Tax Credit?
The unified tax credit in effect combines the estate and gift tax exemptions so that you may be able to avoid paying estate taxes at the time of your death. Or, in other words, those who are inheriting your assets may be able to avoid paying estate taxes with the unified tax credit. The unified tax credit in 2019 was $11.4 million. The figure takes into account the lifetime amount of exempt gifts in addition to estate tax exemptions so that a person can leave an estate of up to $11.4 million without incurring federal estate tax.
Once a “Taxable Estate” is determined, the IRS explains that “the tax is then reduced by the available unified credit.”
Contact a Tampa Unified Taxes Attorney
Do you have questions about estate and gift taxes? Or do you have concerns about ensuring the unified tax credit can benefit you? An experienced unified taxes lawyer in Tampa can speak with you today. Contact Ronald Cutler, P.A. to learn more about the tax services we provide to clients in and around the Tampa, FL area.