Sacramento Probate Debts and Taxes Attorney

The law firm of Johnson, Fort, Meissner, Joseph & Palley can assist clients in northern California with the handling debts and taxes as a part of the probate process.

Estate Debts

When the petition to admit the will is submitted to a court, a concurrent notice to creditors is published in the manner required by law. The notice must be published even if there are no known creditors.

Creditors must present their claims within four months after the issuance of letters testamentary appointing you to serve as executor. This issuance of letters occurs after the notice is published, so there is a date certain for this four-month period. Any claims not presented are forever barred from collection. This includes claims you yourself may have, such as sums you may have advanced to pay funeral expenses.

Claims should be made on special forms and must be approved by both you and the court before you can make payment. Accordingly, all claims should pass through our hands. For your own protection, you should not pay any claims without consulting us. Our lawyers will be happy to provide blank forms to you or any creditors who need them.

California and Federal Estate Tax Returns

California has no inheritance tax for any resident who died after June 8, 1982, except for the "pick-up" tax associated with the statutory allowable credit for state death taxes under Internal Revenue Code 2011.

Depending on the gross value of the estate, it may be necessary to file a federal estate tax return. The federal estate tax return and the tax payment are due nine months after death. The estate has the option to value assets as of the date of death, or under certain circumstances, six months after death. Before the date on which the tax is due, we will make a rough calculation of the federal estate tax to enable us to provide you with an outline of the estate's cash needs for death taxes. A general outline of cash needs for all administration expenses will be made as soon as possible.

It will be necessary to prepare and file federal and state income tax returns for the decedent for the period ending with the date of death. You may also be required to file income tax returns for the estate for each year until the final distribution. We will give you our recommendations about these matters after we have had an opportunity to study them in detail.

The estate is a separate entity for federal and California income tax purposes. It may elect the calendar year or any fiscal year ending at the end of any calendar month within 12 months after death.

You must also file final federal and California income tax returns for the period from January 1, 1998 through the date of death. These returns are not due until their normal due date next April 15. After our attorneys have all the necessary information we will give you our recommendations about the selection of the estate's fiscal year and related income tax matters.

Under current law, a person can give away $1.5 million without having to pay estate taxes. If estate taxes are a concern with your estate, we can offer you the advice of tax specialists who work for our firm. Please contact us today.

Serving the estate debt and taxes needs of clients in northern California, including Sacramento, Carmichael, Citrus Heights, Rancho Cordova and the counties of Yolo, Solano, Sutter, Sacramento, Placer, Yuba, and El Dorado.

For a FREE Initial Probate Consultation
Call Probate Lawyer John Palley at 888-920-5983 / 916-920-5983