Many older people would like to make significant gifts to their grandchildren, in order to help them and in order to reduce the size of their own estate for tax purposes. But they also worry that the grandchildren won’t be able to handle large sums of money. The good news is that you can give each of your grandchildren up to $13,000 a year without incurring any gift tax. If you’re married, your spouse can also
Business owners focus a lot of attention on building better products. When their products are hot, the company does well, despite other shortcomings. Certainly, new and better products are essential, but focusing on building a better business – one that readily adapts to change and quickly responds to crisis may be even more important. How can you build a better business? Consider the following strategies. Manage capital needs. Growing businesses have an appetite for capital. Two
Taxpayers who are struggling to pay their taxes may get some relief from the IRS’s expansion of its “Fresh Start” initiative, a program started back in 2008. The new Fresh Start provisions provide penalty relief to the unemployed and make installment agreements on taxes owed available to more people. Normally, a failure-to-pay penalty of one-half of one percent per month, up to a 25% maximum, is charged for overdue taxes. The “Fresh Start Penalty Relief” initiative
Tuesday, April 17, is the deadline for filing certain returns and taking certain tax-related actions. Here are the major deadlines. Filing 2011 income tax returns for individuals. If you cannot file your return by this deadline, be sure to file an extension request by April 17. The automatic extension (you don’t need to explain to the IRS why you need more time) gives you until October 15, 2012, to file your return. An extension does not,
Jerome and Sandra Murray signed a “joint will” in 1993. It provided that if one of them died, the other would inherit all the property. It also said that the will couldn’t be modified unless they both agreed to any changes. Unfortunately, the couple divorced in 2001. In the divorce settlement, Sandra received a condo in New York. In 2006, she put the condo into a trust. The trust document said that if she died, the
Many power of attorney and health care proxy documents that were created years ago should be revised now as a result of a federal medical privacy law. The law, known as HIPAA, generally prevents health care providers from disclosing your personal medical information to anyone but you and someone you’ve named as your “personal representative.” Medical privacy may be a good thing – but the law can create complications.
As part of their estate planning, many people want to give away property during their lifetime in order to reduce the size of their taxable estate. In general, you can give $13,000 a year to anyone you like without having to pay gift tax, and you can make additional gifts over this limit, over the course of your lifetime, up to the amount of your gift tax exemption (although these larger gifts will reduce your estate’s
If you’re moving (or considering moving) to another state, it’s a good time to update your estate planning. Of course, your estate plan should be updated any time you make a major change, such as buying or selling real estate. But even if you’re not buying or selling anything, it’s wise to review your estate plan when you move because different states have different laws about how estate documents are interpreted. For instance, New Yorker Rosanne
Widows and widowers who are considering remarriage should be aware that a new federal tax law could potentially make a huge difference in how much of their assets they are able to leave to their heirs after taxes. In general, anyone who is considering remarriage later in life should talk to an estate planner first in order to avoid possible tax problems. But this new law gives added urgency to this rule, because it potentially could
Health care legislation passed in 2010 included a tax credit for small businesses that provide health care coverage for their employees. Recent surveys have shown that the majority of small companies that might qualify for the credit have failed to take it. The reasons given for ignoring the credit ranged from being unaware of it to finding the credit too complicated to compute. * Take another look. If your business or nonprofit organization might be eligible,
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