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Executor Duties

Preserve Family Wealth with Portability

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Extension of Time to Elect Portability of the DSUE

and Preserve Family Wealth

In 2011, the IRS introduced the concept of portability of the estate tax exemption from a deceased spouse to a surviving spouse. Currently, with the federal estate tax exemption at $12 million, a married couple can transfer up to $24 million to heirs without a federal estate tax. One of the tools enabling this large tax-free transfer is electing the DSUE, the “Deceased Spouse Unused Exclusion.”

What is Portability and How to Obtain it?

Portability occurs when a surviving spouse files a US Form 706, Gross Estate Tax Return, for the sole purpose of calculating and capturing any unused estate tax exemption from the estate of the first spouse. Completing a Form 706 to make the DSUE election is no easy task.

Why should one elect Portability/DSUE?

If the surviving spouse has an estate worth much lower than the current $12 million estate exemption, why file for the DSUE?

  1. Congress may reduce the estate tax exemption to 5 or 3.5 million
  2. The estate of the surviving spouse may appreciate substantially if there are businesses and/or real estate
  3. A young healthy spouse has many years to accumulate more wealth and have a potential taxable estate
  4. The surviving spouse may inherit from other relatives

When must one file to elect Portability/DSUE?

Good news! This year the IRS extended the time to file for the DSUE election to on or before the fifth anniversary of the decedent’s death.

Conclusion

With the current federal tax exemption so high, spouses should take advantage and claim any unused estate tax exemption after the death of the first spouse. Given the factors mentioned above, even smaller estates should consider filing for portability.

Executor of Estate? Use our Executor Checklist as your Road Map

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The responsibilities of an Executor aren’t limited to deciding who gets which assets – it also means identifying all the decedent’s assets, and ensuring that the proper paperwork is filed with the

Overwhelmed?

IRS, the State and other agencies.To help you through this overwhelming time, Urbach & Avraham, CPAs has prepared an Executor Checklist that outlines the issues that an executor needs to consider.

Click here to access the:  Executor Checklist

 

 

The checklist is a roadmap of tasks, from probating the will, to filing a final Income Tax return and other required estate filings, to dealing with beneficiaries and distributing the assets. It’s loaded with tips on how to locate all assets, save various taxes and efficiently manage the estate administration.

This handy checklist is packed with reminders about technical questions to ask your CPA, legal or other financial advisor. We work with many qualified estate attorneys to seamlessly coordinate your situation.

Finally, the Urbach & Avraham Executor Checklist highlights the complexities presented when a family owned business is involved. Was there a buy sell agreement? Who is paying the estate tax on the business, and are funds available to pay the tax?

As an executor, you’re already coping with a lot of emotional and other issues. We’re available to help lift the financial burden by assisting you with accounting and tax matters during this difficult time.

Executor of Estate? Use our Executor Checklist as your Road Map

by

The responsibilities of an Executor aren’t limited to deciding who gets which assets – it also means identifying all the decedent’s assets, and ensuring that the proper paperwork is filed with the

Overwhelmed?

IRS, the State and other agencies.To help you through this overwhelming time, Urbach & Avraham, CPAs has prepared an Executor Checklist that outlines the issues that an executor needs to consider.

         Click here to access the Executor Checklist

 

The checklist is a roadmap of tasks, from probating the will, to filing a final Income Tax return and other required estate filings, to dealing with beneficiaries and distributing the assets. It’s loaded with tips on how to locate all assets, save various taxes and efficiently manage the estate administration.   

This handy checklist is packed with reminders about technical questions to ask your CPA, legal or other financial advisor. We work with many qualified estate attorneys to seamlessly coordinate your situation.

Finally, the Urbach & Avraham Executor Checklist highlights the complexities presented when a family owned business is involved. Was there a buy sell agreement? Who is paying the estate tax on the business, and are funds available to pay the tax?

As an executor, you’re already coping with a lot of emotional and other issues. We’re available to help lift the financial burden by assisting you with accounting and tax matters during this difficult time.

Who will access your digital assets when you can’t?

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Digital Assets

Proper Estate Planning Can Help Safeguard Your Digital assets

An increasing number of individuals are utilizing online tools, including email, social media and other electronic applications. With a click of a keyboard, they can take care of everything from email and text messages to activities like paying bills online and managing bank and other financial accounts.

Many individuals aren’t aware that the “digital assets” on their computers may represent an important component of estate planning. One study estimated that individuals have more than $35,000 each of personal records locked away on their electronic devices; and an executor or other fiduciary may not be able to access them after an individual has passed on.

Digital Assets Need an Estate Plan

Without an estate plan that addresses digital assets upon death, they may be subject to restrictive federal or state laws, or even the “terms of service” of an online service provider. A surviving spouse who tries to use the decedent’s password to log on to his or her online bank account may be violating the Stored Communications Act of 1986 and/or the federal Computer Fraud and Abuse Act, which keep Internet service providers from disclosing the contents of a user’s information.

These kinds of restrictions can even become an issue during a person’s life, since agents for an incapacitated individual—acting under a power of attorney or as conservators and trustees—may also be barred from access.

Digital assets that may be inaccessible to fiduciaries—and potentially lost to heirs—could include login credentials for online bank accounts, email accounts, social media accounts, and Word documents, PDFs, music and other information stored on computers, tablets, or Smartphones.

Proposed Legislation May Help

A bill recently passed in NJ—the “Uniform Fiduciary Access to Digital Assets Act (UFADAA)- would enable a fiduciary to manage the digital property of a person who has passed away or has lost the ability to manage his own property.

The act covers four types of fiduciaries: executors, guardians of incapacitated persons; agents appointed under powers of attorney; and trustees. It would allow fiduciaries to manage certain digital property, including computer files, web domains, and virtual currency,

Urbach & Avraham Can Help

If Gov. Christie signs the UFADAA, it will be simpler for individuals to ensure that their digital assets are properly protected. The bill would still restrict a fiduciary’s access to email, text messages, and social media accounts—unless the original user consented to expanded access in a will, trust, power of attorney, or other record.

Urbach & Avraham, CPAs works closely with estate and elder law attorneys, and we will be pleased to work with you to address your estate planning and other needs.

Executors Beware: NJ Law Requires Child Support Search Prior to Distribution

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If you are executor of an estate in New Jersey and intend to make a distribution to the beneficiaries, there’s one important step you need to take first. NJ law requires an executor/administrator to initiate a child support enforcement order for any beneficiary receiving in excess of $2,000 prior to the distribution. The executor is personally liable for making a distribution without initiating the order, as the Child Support Judgment is a lien against the net proceeds of any inheritance in NJ.

The search must be conducted by a private judgment search company that will verify results. Urbach & Avraham’s estate administration services include the performance of Child Support Searches. If you would like assistance with your Child Support Search, call us at 732-777-1158 or email Pamela at pma@ua-cpas.com