flyfishnevada
Full time employment: Posting here.
My wife and I are taking care of my FIL's estate. He has dementia and cannot make any decisions for himself. His estate isn't large, basically his home. He will see about $50,000 from the sale. He has a pension, medical and long term care insurance that can easily cover his living and medical needs.
My DW is the sole heir. My question is about estate taxes. When he dies any money he has will be subject to state and federal estate taxes. While he is alive, he can "gift" us money with no tax implications to either himself or us. Do I have that right?
Since my wife has POA, what if we had him gift us most of the proceeds of the sale of his house and we invest it until the time of his death. If he needs it we can use those funds. Upon his death, we then don't need to worry about estate taxes and such.
Is that legal? Would the IRS frown on that? I know some people gift money to relatives to avoid taxes, but since my FIL is not capable of explicitly gifting us money, would that be a problem. He has said he wants my DW to get all of his possessions and money and has a will to that effect. We assume, pretty sure actually, that he would not want to pay a big part of that to the government and fer my DW to get more of what he worked for.
Thanks!
My DW is the sole heir. My question is about estate taxes. When he dies any money he has will be subject to state and federal estate taxes. While he is alive, he can "gift" us money with no tax implications to either himself or us. Do I have that right?
Since my wife has POA, what if we had him gift us most of the proceeds of the sale of his house and we invest it until the time of his death. If he needs it we can use those funds. Upon his death, we then don't need to worry about estate taxes and such.
Is that legal? Would the IRS frown on that? I know some people gift money to relatives to avoid taxes, but since my FIL is not capable of explicitly gifting us money, would that be a problem. He has said he wants my DW to get all of his possessions and money and has a will to that effect. We assume, pretty sure actually, that he would not want to pay a big part of that to the government and fer my DW to get more of what he worked for.
Thanks!