Alabama Estate Planning Lawyer Blog

The Christian Science Monitor reports that there will be a substantial increase in the number of estate tax returns filed with the IRS this year. This is despite the fact that there will be fewer than 3,300 estates that will be required to pay federal taxes. The current state of the law encourages estates to file returns even if they do not owe any taxes to the federal government. The result: increased costs and an increased number of returns for the IRS to process.

Why do these estates to continue to file returns? The answer lies in the details of the portability provision of the 2010 Tax Relief Unemployment Insurance Reauthorization and Job Creation Act. This provision allows surviving spouses to claim on their own estate tax returns any exemption not used by their deceased spouses.

The 2011 estate tax exemption is $5 million. If a husband dies this year and leaves an estate with a taxable value of $3 million, his estate owes no tax and his wife's estate may claim the unused $2 million exemption when she dies. Thus, if the $5 million exemption remains in effect, her estate could avoid tax on its first $7 million." However, and this is an important trick, in order to claim the portability exemption, the estate is required to file a tax return during the appropriate time. If the estate fails to do so, it is not possible for the estate to ever claim the unused exemption.

Couples who have estates of more than $10 million routinely file for such exemptions, but even couples with smaller estates can benefit from it. It is possible that Congress will lower the current $5 million exemption for large estates. It is also possible that Congress will disallow the exemption in future legislation, which most estates will likely challenge in the courts. It is uncertain what kind of impact this will have on the future of estate planning and attorneys must stay up-to-date regarding these important changes.

The Huntsville estate planning attorneys at Martinson & Beason will provide you with the highest level representation and work tirelessly to ensure that your estate is well protected. Please do not hesitate to contact Martinson & Beason if you find yourself need the assistance of an Alabama estate planning lawyer.

Source: "Why the IRS will be flooded with estate tax returns this year." by Roberton Williams, published at CSMonitor.com.

Forbes.com reports that Brooke Astor's multi-million dollar estate is now facing an extensive tax bill from the Internal Revenue Service. The estate has recently filed multiple lawsuits in the United States Tax Court. The lawsuits challenge the IRS's demand that the executors of the Astor estate pay another $62 million in fees.

There is some discrepancy between the IRS and the estate about the total value of Astor's estate. The IRS claims that the estate is worth some $223 million and the federal government is entitled to $97 million in federal estate taxes. The Astor estate, on the other hand, claims that the estate is only worth $93 million and that the federal government is thus only entitled to $35 million in taxes and fees. Neither of these claims matches the $131 million estimate published in the New York Times that the public heard right before Mrs. Astor's death.

The IRS included in the value of the estate gifts worth about $20 million that Mrs. Astor gave away. The estate acknowledged that federal gift tax returns were not filed and the IRS has assessed $2 million in penalties for the estate's failure to file the returns. The estate also claims that $96 million comes from charitable bequests that should be deducted, but the IRS refuses to allow those to be used to reduce the amount of the tax debt because the IRS cannot be certain about those charitable bequests.

Astor's estate is still in the process of liquidation. Her apartment just recently sold for $21 million and her jewelry and art are expected to bring in about $5 million at auction. Brooke Astor acquired her enormous fortune when her husband, Vincent Astor died and left her his entire fortune. Vincent Astor was the son of the famous John Jacob Astor IV who died on the Titanic's famous maiden voyage. At the time of his death, John Jacob Astor left his son Vincent an estate worth an inflation adjusted $1.7 billion.

If you require the assistance of a Huntsvile estate planning attorney to keep you from falling in the same trap as the Astor estate, the estate planning lawyers at Martinson & Beason are here to assist you. Please call toll free at 1-800-255-6534 with any estate planning questions.

Source: "Brooke Astor's Estate Now Faces $62 Million Attack by IRS," by William P. Barrett, published at Forbes.com.

Don't be intimidated, probating an estate in Alabama is not as complicated as advertised by many. In fact, it can be done quickly and cheaply with the right estate plan - and the right attorneys. Avoiding probate in Alabama can be beneficial, but more times than not, going through the probate court to administer an estate is necessary. There are a number of reasons for this including:

• Transferring title to land to your heirs
• Transferring assets to heirs, beneficiaries
• Accessing bank accounts of the decedent
• Settling debts, mortgages, and claims
• Bringing wrongful death suits

These are just a few of the reasons that probating an estate may be necessary. For most people in Alabama, administering a decedent's estate through probate court in their county is simply to ensure that property of the decedent goes to the rightful heir or beneficiary. The probate attorneys of Martinson & Beason, P.C. have almost 75 years of experience in assisting clients with navigating this process and ensuring that everything is done correctly.

It is important to know that although the probate process in Alabama can, and in some cases should be avoided, it doesn't have to be difficult. The Huntsville, Alabama probate attorneys at Martinson & Beason, P.C. have all the expertise, experience, and tools necessary to ensure that the process is done as quickly and efficiently as possible.