North Carolina Estate Planning Blog: “Planning for tax-qualified plans, which includes IRAs, 401(k)s and qualified retirement plans, requires a careful examination of the potential taxes that impact these assets. Unlike most other assets that receive a ‘basis step up’ to current fair market value upon the owner’s death, IRAs, 401(k)s and other qualified retirement plans do not step-up to the date-of-death value. Therefore, beneficiaries who receive these assets do so subject to income tax. If your estate is subject to estate tax, the value of these assets may be further reduced by the estate tax. And if you name grandchildren or younger generations as beneficiaries, these assets may additionally be reduced by the generation-skipping transfer tax. All tolled, these assets may be reduced by 70% or more. There are several strategies available to help reduce the impact of these taxes:”
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- Getting Started On Your Estate Plan
- IRS Issues Guidance on 2009 Required Minimum Distribution Waiver
- Estate Tax Repeal in 2010 (or not) & What It Means for CPAs & Their Clients
- Sign an Estate Plan to Eliminate Guessing When You Die
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- How to Hand Down Assets in Retirement Plans
- Seven Reasons Why Congress Should Repeal, Not Fix, the Death Tax
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