The United States imposed a succession duty by the War Revenue Act of 1898 on all legacies or distributive shares of personal property exceeding $10,000. It is a tax on the privilege of succession. Devises or distributions of land are not affected by it. The rate of duty runs from 75 cents on the $100 to $5 on the $100, if the legacy or share in question does not exceed $25,000. On those of over that value the rate is multiplied 11 times on estates up to $100,000, twofold on those from $100,000 to $200,000, 21 times on those from $500,000 to a $1,000,000, and threefold for those exceeding a million. This statute has been supported as constitutional by the Supreme Court.
Many of the states also impose succession duties, or transfer taxes; generally, however, on collateral and remote successions; sometimes progressive, according to the amount of the succession. The state duties generally touch real estate successions as well as those to personal property. If a citizen of state A owns registered bonds of a corporation chartered by state B, which he has put for safe keeping in a deposit vault in state C, his estate may thus have to pay four succession taxes, one to state A, to which he belongs and which, by legal fiction, is the seat of all his personal property; one to state B, for permitting the transfer of the bonds to the legatees on the books of the corporation; one to state C, for allowing them to be removed from the deposit vault for that purpose; and one to the United States
One way to defer the estate taxes is creating a trust.
A trust or a decedent’s estate is a separate legal entity for federal tax purposes. A decedent’s estate comes into existence at the time of death of an individual. A trust may be created during an individual’s life (inter vivos) or at the time of his or her death under a will (testamentary). If the trust instrument contains certain provisions, then the person creating the trust (the grantor) is treated as the owner of the trust’s assets. Such a trust is a grantor type trust. A trust or decedent’s estate figures its gross income in much the same manner as an individual. Most deductions and credits allowed to individuals are also allowed to estates and trusts. However, there is one major distinction. A trust or decedent’s estate
At Green60.com, we provide limited information regarding insurance and financial matters. Green60.com is NOT and insurance agent or broker and we do not offer or sell insurance or financial products. We are not classified as 401k or Sep IRA provider. We have contracted with several reputable companies who offer these types of the services. As a payroll service provider we are more than happy to work with your agent to facilitate this process. Through our payroll system we can deduct and transfer the designated funds from your account to the investment company.