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What are my estate tax obligations in Illinois?

An executor of an estate is charged with handling a variety of responsibilities when a testator dies here in Park Ridge or another part of the Prairie State. An Illinois executor is responsible for paying estate taxes.

Most Illinois executors never have to worry about paying estate taxes. They often don't have to concern themselves with this because the total value of the assets that the testator left behind don't come close to reaching the $4 million threshold that must be met for them to be assessed this tax.

The executors for the handful of Illinois testators who have estates valued more than $4 million must pay this tax before they can ultimately distribute any assets to heirs. This tax is assessed on a graduated scale and can reach as high as 16%.

Illinois executors aren't just responsible for paying a state estate tax though. They have to pay a federal one as well. This federal tax doesn't have to be paid unless an individual's estate exceeds $11.18 million as of 2018 though. Married decedents qualify for an exemption that's double that amount.

Individuals who have assets that exceed the exempted amount are required to pay federal estate taxes.

Those individuals with taxable estates of up to $10,000 may be assessed a base tax rate of $0 and 18% of their income. A decedent with a taxable estate of more than $1 million may be required to pay a base tax rate of $345,800 and 40% of their income.

It's generally not necessary for the executor of the estate of an individual with a surviving spouse to pay an estate tax, even if their assets are valued at more than $4 million. Illinois law generally allows all the wealth of the decedent spouse to be transferred to their husband or wife upon their passing.

That spouse is entitled to take an estate exemption once. This is why many couples set up trusts to minimize their tax burden.

There are many options for minimizing your estate's tax burden once you're gone. If you're looking to understand what those are so you can minimize the problems that your loved ones face down the road, then you should consult with an attorney. They can advise you of the options that are available to you so that you make sure that your family is taken care of when you're gone.

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