There are taxes that can be imposed on your assets after you pass away if certain circumstances exist. Just how many levels of taxation there are to contend with is going to vary depending on where you reside.
Everyone in all 50 states must be concerned with the federal estate tax. This levy carries a 35% maximum rate at the present time, and the exemption amount is $5.12 million. So only the portion of your estate that exceeds this exempt amount is subject to the 35% death tax.
Before you assume you are safe because your assets fall within this exemption, you should recognize the fact that these parameters are going to change at the end of the year if current laws remain in place. In 2013 the exemption goes down to $1 million and the rate rises to 55%.
Some states also impose a separate estate tax of their own that is levied against your assets in addition to the federal estate tax. Oklahoma is not among them though we did have an estate tax on the state level that was repealed.
And then there is the inheritance tax. This is a tax on what a beneficiary receives. Each heir to an estate must pay on his or her inheritance. Once again, we are fortunate here in our area because there is no inheritance tax in Oklahoma at the present time.
Doing what you can to mitigate your tax exposure is essential when you are preparing your assets for eventual distribution to your heirs. The best way to go about it is with the assistance of a licensed, experienced, and savvy Oklahoma City estate planning lawyer.
Larry Parman
Author, President and Founding Attorney
Parman & Easterday
Since founding Parman & Easterday in 1985, Larry has led over 1,000 free, community-service education programs and helped more than 10,000 Oklahoma families go from putting off their estate plan to getting it done. His goal for every client is the same: to become the person their family calls "the one who took care of everything."
Larry is the author of three books: The Straight Shooter's Guide to Estate Planning; Estate Planning Basics; and Guiding Those Left Behind in Oklahoma. He served as Oklahoma's Secretary of State and Secretary of Commerce, and his firm is the only member of the American Academy of Estate Planning Attorneys in the state.
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