Estate planning plays a significant role in preparing for the future, yet it is often overlooked. For individuals at various stages of life—whether beginning a career, expanding a family, or nearing retirement—a comprehensive estate plan can provide clarity. However, errors in this process may result in challenges for surviving family members. Outlined below are seven frequent estate planning mistakes and approaches to avoid them.
Posted in Asset Protection,Probate & Trust Administration,Tax Law & IRS Defense,Wills, Trusts & Estate Planning
The recently enacted One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduces significant modifications to federal estate, gift, and generation-skipping transfer (GST) tax rules. These updates are likely to impact estate and wealth transfer planning for many individuals and families.
As a law firm specializing in solving IRS problems, tax resolutions typically begin with getting taxpayer clients in compliance. In other words, most tax resolutions first require tax compliance. In this post, we’ll guide you through the best practices to help you stay on the right side of the IRS.
1. Estimated Tax Payments
Estimated tax is the method used to pay taxes on income that is not subject to withholding. This may include income from self-employment, business earnings, interest, dividends, rent, or alimony. It also applies to individuals who do not elect voluntary tax withholding. Think of the IRS as a “pay as go” system. It does not matter whether taxes were withheld. It’s generally your obligation to pay the taxes prior to tax filing.
“HEMS” stands for “health, education, maintenance, and support” and is commonly referred to as an “ascertainable standard”. If there is a HEMS provision in a Trust, the money distributed can only be used for specific needs of the beneficiary related to health, education, living expenses, or other needs or support that a Trustee can ascertain. Some examples include health insurance, surgery, exercise equipment, prescriptions, tuition, career training, rent, mortgage payments, home repairs, taxes, legal fees, vacations, or other reasonable comforts.
An estate tax return (Form 706) must be filed if the gross estate of a decedent, increased by the decedent’s adjusted taxable gifts and specific gift tax exemption, is valued at more than the filing threshold for the year of the decedent’s death. The filing threshold for 2022 is $12,060,000. The threshold is adjusted for inflation and increases each year. An estate tax return also must be filed if the estate elects to transfer any deceased spousal unused exclusion (DSUE) amount to a surviving spouse, regardless of the size of the gross estate or amount of adjusted taxable gifts. The election to transfer a DSUE amount to a surviving spouse is known as the “portability” election.
You have probably used payment apps like Venmo or Zelle to transfer money to a friend or make a payment to a business. Think of these payment apps as a faster way to transfer money when compared to prior formats such as PayPal or Stripe. Recently, there was a provision in the American Rescue Plan Act of 2021 that reduced the threshold for these type of transactions from $20,000 or 200 transactions to $600 without regard to the number of transactions, resulting in businesses receiving Form 1099-K’s (and the IRS also receiving the tax form). This new law allows for increased potential for businesses to be audited if they do not correctly report their earnings.
Posted in Asset Protection,Probate & Trust Administration,Tax Law & IRS Defense,Wills, Trusts & Estate Planning
Many people worry about filing or paying taxes to IRS or the federal government at death. The truth of the matter is that very few need to be concerned. According to IRS data, just 0.15% of decedents needed to file an estate tax return (Form 706) in 2019, and only 0.07% will pay any estate tax. That’s lower than the historical 1% to 2% share. Note there are some states that also have an estate or inheritance tax. Florida is not one of those states.
Calendaring important IRS and tax authority deadlines can help you avoid stress. To avoid paying penalties and other tax consequences, calendar tax deadlines and plan for tax filings with your accountant and other members of your professional team. Below are few examples of important tax deadlines:
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