You have probably heard of the term “death tax” before. When the term death tax is used, it is referring to the estate tax. Every state operates differently with regard to its tax structure and guidelines. If you are thinking of putting together a comprehensive California estate plan, call Leiva Law. At Leiva Law, you will receive personal attention from the experienced team of California estate planning attorneys who will review all of your assets and construct an estate plan that meets your specific requirements.
What are California’s Estate Tax Laws?
In the state of California, there is no estate tax. California along with 37 other states don’t impose an estate tax no matter how big the estate is. Estate taxes, though, are different than inheritance taxes. The government takes estate taxes before any of the value of the estate is dispersed to beneficiaries. With inheritance taxes, the beneficiaries receive the wealth passed down to them and then they pay a tax on that wealth.
Many states do not have inheritance taxes including California. Additionally, California does not have a gift tax. This all sounds pretty great when you are trying to maximize the amount of wealth you pass on to your loved ones through your Los Angeles estate plan. However, if you are a beneficiary that lives in California but is receiving an inheritance from another state, that inheritance could be subject to taxes depending on the tax laws of that state.
Even though California does not have its own estate and inheritance taxes, it is still one of the highest tax states in the country. In California retirement accounts and pension plans are taxed, income taxes can be as high as 12.3%, and people that earn more than $1 million are also subject to a 1% surtax. Sales tax in California at it’s lowest is 7.35% and at it’s highest 10.25%. Outside of state taxes, you also must consider federal taxes.
Managing your finances and wealth in a way that allows you to pass on as much as possible to your loved ones takes careful planning and work. Developing an effective California estate plan that meets your needs is an ongoing process. Once you have put a plan in place that satisfies all of your specifications you should revisit your plan regularly to adjust it to accommodate changes in your life such as the addition of a child.
Speak with a Qualified California Estate Planning Lawyer Today
At Leiva Law, your interests will be taken care of by an experienced team of professionals that have a passion for excellence. Our Los Angeles probate attorneys understand that in many cases, estate planning can take place at a time in a person’s life that may be emotional. Our compassionate team can provide you with the best legal advice possible, allowing you to have the peace of mind that your estate is will be handled exactly how you’d want it to be when you pass it on to your loved ones. Call Leiva Law today to schedule your free consultation at 818-519-4465.