As a professional in the accounting and tax field, I have many clients, especially this time of year, that may have lost a spouse or business partner due to death.
Like the old saying sometimes attributed to Ben Franklin goes, there is nothing certain except death and taxes. Well, filing and paying taxes after a loved one has died is still something that must be done. Either it falls to the heirs or to an executor, but the “final” return must be done.
If an individual dies during the year, and he or she received income, then they need to file a tax return. If you are married and your spouse passes during the year, then you can file married filing jointly or married filing separately - whichever gives you the best tax treatment of your income. Sometimes you must do different calculations to determine this.
Money received from life insurance annuities, IRAs or other pensions, or stock/mutual fund holdings may have tax implications that need to be addressed, and proper tax planning is essential. More often than not, funds are received, taxes become due and no planning was done to cushion the tax bill shock.
After a loved one’s death and dealing with a multitude of issues, seeking financial advice might seem like nonsense. But a few minutes with a professional can be a stress reliever.
When business partners are involved, even if the partners are spouses, there are considerations to be made and taxes to be filed for the business that may involve a “final” return for the business. Business taxes are much more complicated and beyond a simple explanation here but going on as “normal” may take more effort to keep the business going, but tax issues are also involved.
How can we all make tax time easier? Yes, this can be a less stressful time if planning is done early. Doing a review of financial accounts to be assured there are beneficiaries named is a great start. Births, deaths, divorce all can change who is or is not listed on financial accounts as beneficiaries. Succession plans and details, not unlike a will, for businesses will assure that.
Talk to both an estate/business attorney and your licensed tax professional to make sure everyone is aware of your succession plans for your business. Doing so before it is needed is like writing a will or buying life insurance - we hope something never happens, but we want the people in our lives to be aware and make transitions smooth.
Karen S. Durda, EA, President of Century Accounting and Tax Services, Inc., has been in the profession since 1984. As an Enrolled Agent credentialed by the Treasury Department, she has the rights as afforded by Congress to represent individuals and businesses before tax authorities. Since May 2012, she has also had the distinction of being a Dave Ramsey Endorsed Local Provider, assisting in budgeting and financial peace for a four-county area and parts of Myrtle Beach.As a Qualified Business expert with the New Hanover County courts, she has experience and knowledge of various scopes of professions and industries, such as medical, health services, legal, construction, retail, real estate, auto sales and service, insurance and restaurant. Continuous tax law courses throughout the year keep her up-to-date on all tax rules, regulations and law changes, as well as business trends, to better serve her clients.
City Club, Event Center On The Market For $7.5 Million
Emma Dill
-
Apr 16, 2024
|
|
Wilmington Tech Company Tapped For Federal Forestry Contract
Audrey Elsberry
-
Apr 15, 2024
|
|
Commercial Real Estate Firm Promotes Adams, Mitchell To Vice President Roles
Staff Reports
-
Apr 16, 2024
|
|
New Hanover Industrial Park To Get $3.3M In Incentives For Expansion, New Jobs
Emma Dill
-
Apr 15, 2024
|
|
Gravette Named Executive Director Of Nir Family YMCA
Staff Reports
-
Apr 16, 2024
|
Brunswick Surgery Center recently received four certificates of excellence from accreditation organization DNV Healthcare....
Since Jennifer Harjo opened New Hanover County’s Public Defender’s Office in 2008, she has strived to ensure her clients receive their Const...
CFCC recently announced its emergency medical services program has achieved accreditation from the Commission on Accreditation of Allied Hea...
The 2024 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.