Posted by Brent_IL on February 12, 2002 at 12:28:11:
The taxes don’t affect you, they affect your offer.
I’m not totally up to date on estate taxes. The IRS may accept a very limited installment arrangement. There might be a few flower bonds floating around, also.
Someone?s taxable estate is their gross estate less allowable deductions. An estate tax applies to the taxable estate at time of death. Your gross estate includes the value of all property in which you had an interest at the time of death. This includes property that you transferred within 3 years prior to your death. Dependant upon the ownership, life insurance can be included, too. You can exclude things like current debts, funeral expenses, and, if you?re married, a marital deduction. Everyone is eligible for a unified credit that, if they haven?t used up in gifting, can be applied to the taxes due. I think anything else has to be paid in a short time, like nine months.
Seller-financing features money received over time. The estate taxes are due now. That?s why an executor might accept cash now in lieu of profits later.
The cash doesn’t have to come from the property if it’s available from some other source. Some times the property is all there is.