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What Happens To My Debts and Assets When I Die?

Mortgage and Lending with Nationwide Funding Group

An estate tax is defined as federal tax on the transfer of assets owned by the estate of a person who has died. Depending on how much you owe when you die , your estate may have to pay estate taxes before your assets can be full distributed. Estate taxes are different from and also in addition to probate expenses and final income taxes owed on income you recieve in the year you die. It is also important to note that they are also seperate from inheritance taxes that are collected from certain states. Federal estate taxes may be due on estates greater than $1,000,000.00. But there is no limitation on the amount of property that is left to a spouse. In California there is no inheritance tax. An inheritance tax is a tax levied by states on inherited property and paid by the person recieving the property. Another type of tax that exists in regards to real estate is known as the gift tax. This is a tax that can be due when you give a property or other assets to someone. Federal tax allows a donor to give $11,000.00 per year to any number of donees with no gift tax due. Here in California there are no gift taxes.

Has anybody on here been a recepient of a property or a major asset?

Leslie Bloss, Bellevue Real Estate Professional
Bellevue, WA

Hi Eddy--Cute picture!  Anyway, Estate Tax is one of my pet peeves.   My Mom and Dad saved their money and invested it well--they didn't have "high paying" jobs but were very careful how they spent and my Mother still is to this day washing out plastic bread sacks and reusing them.  This money is her "security blanket" (just in case we have another "Great Depression" or whatever she thinks.  This money already has been taxed.

She has taught me pretty well (although she has me beat in the thrifty department). 

When she passes on (if there is an inheritance) will be used as a legacy to her and will pay for college for her great grandchildren.  It will also allow us to make loans at lower interest rates to family members (something she has done for many in the past).

Nov 06, 2006 11:22 AM
Stefan Scholl
Buyer's Broker of Northern Michigan, LLC - Petoskey, MI
Northern Michigan Real Estate
If you are fortunate enough to receive an inheritance from a rich uncle, effective January 1, 2006 until 2009, the federal estate tax exemption equivalent increased to $2,000,000 (up from $1,500,000 in 2005).
Nov 06, 2006 03:42 PM