Law Office of Rick Todd Blog

Saturday, May 9, 2015

Will My Family Need to Worry About Estate Taxes When I Die?

Possibly. If you reside in Maryland (and Howard County) when you die, your estate may have to pay both federal estate tax and Maryland estate tax. Maryland is one of the few states in the country that has an estate tax! The good news is that estate taxes are only paid by the very wealthy. The IRS estimates that less than one percent of estates annually are subject to the federal estate tax. For this year the Federal estate tax is levied against estates worth more than $5.43 million.

Unfortunately for Maryland residents, the Maryland estate tax as of 2015 is $1.5 million. That is a tax on the value an individual's entire estate; his house, car, life insurance policies, retirement accounts etc. That's not too significant an amount for many members of the middle class who have had stable careers and years of accumulating wealth. The Maryland estate tax exemption will rise to $2 million in 2016, $3 million in 2017, $4 million in 2018, and finally be the equivalent of the federal estate tax in 2019, whatever number that may be (probably somewhere around $6 million depending on the rate of inflation).

Even if your estate isn't large enough to be taxed when you die, you still need to worry about the distribution of your estate's assets to loved ones!

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The Law Offices of Rick Todd has offices located in Columbia, Chevy Chase, Fairfax, Virginia, and Maryland and serves clients throughout Clarksville, Columbia, Ellicott City, Fulton, Rockville, Bethesda, Potomac, Laurel, Howard County, Montgomery County, and Washington D.C.

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