Is There An Estate Tax In Florida?
No one likes to think about taxes but of all the different types, estate taxes are often overlooked. Estate taxes can be substantial and they are a financial burden for families that are already grieving. There are 12 states in the country, as well as the federal government, that place an estate tax on property that is left to heirs after someone passes away. So, does Florida place a tax on the estates of deceased individuals? Below, our Daytona Beach estate planning lawyer explains further.
What are Estate Taxes?
Estate taxes are sometimes also known as a ‘death tax’ or an ‘inheritance tax’ and there is a valid reason for this. No matter what they are called, estate taxes place a tax on the property in a person’s estate after they die and usually, it does not matter what type of property it is. Generally speaking, any property in a person’s estate can possibly have a tax applied to it. Once a person passes away, the property in an estate is distributed to the heirs, or beneficiaries, and these individuals must pay a tax on them.
There is No Estate Tax in Florida
Inarguably, Florida is one of the tax-friendliest states in the United States. Florida has some of the lowest property taxes in the entire country, and the state also does not have an income tax. Staying in line with these tax-friendly laws, the Sunshine State also does not impose an estate tax. This means that when a person passes away, no taxes are applied to the property within their estate and their beneficiaries are not responsible for paying them. For people planning for their estate, this is a relief. Although there is no estate tax in Florida, that does not mean that beneficiaries are always protected.
When are Estate Taxes Applied?
While Florida does not apply taxes to estates, there are times when beneficiaries are still responsible for paying them. If someone lived in another state before they passed away and they left you property, the estate tax in that state would apply to the property. Pennsylvania, for example, does have an estate tax and so, any property of a deceased person in this state would have taxes applied to it.
Even when a person does live in Florida, their estate may be subject to an estate tax. A federal estate tax applies to estates that are valued at $11.7 million or more. For married individuals, the federal estate tax only applies to estates that are valued at $23.4 million or more. The larger an estate is, the more taxes that apply at a federal level and taxes can be as high as 40 percent.
Our Estate Planning Lawyer in Daytona Beach Can Help You Avoid Taxes
It may seem impossible to avoid estate taxes but at Bundza & Rodriguez, our Daytona Beach estate planning lawyer can help. Our experienced attorneys can draft an estate plan that will protect your family from unnecessary estate taxes. Call us now at 386-252-5170 or contact us online to schedule a case evaluation and to learn more about how we can help.
Source:
irs.gov/businesses/small-businesses-self-employed/estate-tax
