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Introduction to the Unified Tax Credit The unified tax credit, also referred to as the unified transfer tax, is an essential component of estate planning for institutional investors, combining two separate lifetime tax exemptions for gift and estate taxes into one unified system. This tax credit offers several advantages by
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Overview of Gift Taxes and Form 709 Gift taxes refer to federal taxes that apply when an individual transfers money, property, or other assets to another person as a gift. In certain circumstances, the giver must file a gift tax return (Form 709) with the Internal Revenue Service (IRS). First,
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Introduction: Understanding Exempt Income Exempt income is a term used for certain types of income that are not subject to income tax. Both federal and state governments have their rules defining what counts as exempt income, with the IRS setting the guidelines at the federal level. Key takeaways for exempt
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Overview of Estate and Inheritance Taxes Estate taxes and inheritance taxes are two distinct but related taxes levied on assets that change hands upon the death of an individual. Estate tax, also known as the “death tax,” is a levy imposed by the government on an estate based on its
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Introduction to Applicable Federal Rate (AFR) The Applicable Federal Rate (AFR), as determined by the Internal Revenue Service (IRS), represents the minimum interest rate for private loans between related parties. Established in accordance with Section 1274(d) of the Internal Revenue Code, these rates serve as a reference point for tax
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