Estate Taxes Generally:  
Estate taxes are paid by the estate of the decedent, not by the beneficiaries or heirs of
the decedent.

The estate tax rate for a person with an estate of over $2,000,000.00 is 45%.

Personal Estate Tax Exclusion:  
Presently the IRS allows a personal estate tax exclusion of $2,000,000.00.

Marital Deduction:  
The IRS allows married couples to transfer an unlimited amount between spouses
upon the death of the first spouse to die.

The Marital Deduction Trust:
The marital deduction trust allows a married couple to preserve the personal exclusion of both  
spouses upon the death of the second spouse to die.

Gift Taxes Generally:
Estate taxes are paid by the donor (giver), not by the donee (recipient) of a gift.
The gift tax rate is 55%.

Gift Tax Exclusion:  
The IRS allows an annual personal gift tax exclusion to the person making a gift of $12,000.00,
per
individual to whom such a gift is made, with a life time gift tax exclusion of $365,000.00.

Basic Capital Gains Formulae:
Basis = Purchase Price + Capital Improvements
Capital Gain = Fair Market Value – Basis
Taxable Capital Gain = Capital Gain – Personal Exclusion
Philip McCarthy
Attorney at Law
You cannot win the game if you do not
know the rules.
BASIC TAXATION FACTS

For a more detailed analysis of
Basic  Tax Issues
contact me.