Getting a large inheritance can create new financial opportunities. But it’s important to handle inherited assets carefully, especially when it comes to taxes and planning. Understanding relevant tax rules can help you avoid surprises and make informed decisions.
What Is the Net Investment Income Tax (NIIT)?
The Net Investment Income Tax (NIIT) is a 3.8% surtax that applies to certain types of investment income when your income exceeds specific thresholds. While often associated with high earners, it can also affect moderate-income taxpayers during years with large gains—such as the sale of assets or investments.
Estate Planning for 2026 and Beyond
Until recently, much tax uncertainty surrounded estate planning. The Tax Cuts and Jobs Act doubled the federal gift and estate tax exemption to an inflation-adjusted $10 million, but only for 2018 through 2025.
Fortunately for those with larger estates, in 2025, legislation was signed into law that increases the exemption to $15 million for 2026, with annual inflation adjustments going forward — and no expiration date.
Appraisals Aren’t Just for Businesses
Whether you’re in the process of making a retirement or estate plan or you intend to donate property to charity, you’ll need to know the value of your assets. An appraisal may be necessary for many hard-to-value items, such as closely held business interests, real estate, art, and collectibles.
Itemized Deductions for Estates and Trusts: What’s Still Allowed?
While individual taxpayers currently cannot claim miscellaneous itemized deductions through 2025, certain deductions for estates and non-grantor trusts remain available under IRS guidance. This distinction is critical for fiduciaries, estate administrators, and beneficiaries navigating tax filings.
Estate and Succession Planning for the Family Business
The future often weighs heavier on the shoulders of family business owners. Their companies aren’t just “going concerns” with operating assets, human resources, and financial statements. The business usually holds a strong sentimental value and represents years of hard work involving many family members.
Payable-on-Death Accounts: Beneficial Tools if Used Correctly
Payable-on-death (POD) accounts can be a quick, simple, and inexpensive way to transfer assets outside of probate. They can be used for bank or credit union accounts, certificates of deposit, and even brokerage accounts. Setting up such an account is as easy as providing the financial institution with a signed POD beneficiary designation form. Upon your death, your beneficiaries need to present identification to the bank, with a certified copy of a death certificate, and the money or securities will be theirs.
Have You Recently Reviewed Your Life Insurance Needs?
At one time, life insurance played a much more significant part in an estate plan than it does now. Why? Families would often use life insurance payouts to pay estate taxes. But with the federal gift and estate tax exemption at $13.61 million for 2024, far fewer families currently are affected by the estate tax.
Buy-Sell Agreements Require Careful Planning
Does your business have multiple owners? If so, you need a buy-sell agreement. This type of binding contract determines how (and at what price) ownership shares of a privately held business will change hands should an owner depart. There are also potential tax consequences to consider.
POA Authorization Approval Requests Available Online
Estate Planning and the Power of Attorney
An important part of estate planning is designating a power of attorney; however, the IRS will not discuss your taxes or identity with anyone without your authorization. Recently, the IRS has made it easier for taxpayers to quickly review, approve and sign power of attorney and tax information authorization requests through their IRS Online Account.