Not only is it important to simply create an estate plan, it is important how one implements an estate plan. The best way to do this will depend upon the specific circumstances of one’s case. Also, each person’s estate administration may vary from person to person in Maryland or in any other state. For instance, business owners usually have concerns that are specific to those who own a company.
It would be beneficial for business owners to be aware of the various intricacies involved in how the law treats a business entity and business assets when it comes to administering an estate. Much of this will also depend on how a specific business is structured as well as what type of assets the business owns. This can have a significant effect on an estate’s potential exposure to tax liabilities.
For instance, small business estates that possess real property assets may qualify for an extra benefit known as the “special use valuation.” Essentially, if the real estate had been regularly used in the course of running a business, and will continue to be utilized for a family-run business, it is possible that it could receive special tax treatment. With the special use valuation benefit, the real estate property will be valued at productive value rather than fair market value, which will help to reduce some tax liabilities.
However, utilizing the special use valuation benefit may not be straightforward. There are some laws in Maryland that regulate this application of the special benefit. Also, these laws are constantly in flux, and it is important to have knowledge of the latest changes. Additionally, it is essential to understand how to apply these rules and regulations to one’s specific case in order to help reach estate administration goals.
Source: agweb.com, Plan Your Estate, Darrell Dunteman, March 22, 2014