Estates are a bundle of things in one place. For example, an estate may consist of real property such as a house or a lot without a home or other buildings on it. An estate may also consist of other items that someone wants to leave to someone else. For example, this might include shares of stock in a business venture. It might also include lots of American government bonds. An estate can also consist of other types of of property. A person might have a valuable collection of jewelry, antique furnishings and art they have collected over time. These are all forms of items that can be passed to an individual or a foundation for the benefit of the next generation. They’re also items that can easily attraction the attention of those of at the Internal Revenue Service.
One of the first things that will happen when you are under scrutiny by the IRS is that they will let you know formally that an investigation is going to take place. The process of the investigation is known as an audit. An audit is when an IRS official examines all areas of the estate. You are expected to bring in as many documents as you can when this process begins. That includes the will that designated each item and who is supposed to receive it. The will also typically includes someone who is charge of seeing that each item is given to the person as specified by the deceased. A well should be a formal document that has binding legal force on all those who are mentioned in it including both individuals and any companies or foundations that might be the recipient of the person’s largess.
The purpose of the audit is varied. In general, this is when officials want to have a close look at all aspects of the recipient in order to ensure that all rules and regulations have been followed. They are also looking for any potential irregularities with the disbursal of the items. For example, a will might have left someone a home. This home might have been purchased a long time ago. Since that time, the home has increased in value. The same is true of stocks that were purchased a long time before the person in question died and left them to someone else. People are only allowed to leave a certain amount of money to others without incurring an estate tax. It is possible for the will to indicate that a property or stocks are only worth a given amount. And yet the property being passed on is worth a lot more.
Examining the Books
An audit is all about examining the estate in detail. Even a relatively small estate can have all kinds of complications. Many people try and avoid problems with their will by consulting with officials before they assign property. However, it is possible for people to make mistakes when it comes to the property and the other items the person owned. A person might have vastly underestimated the value of the items in question. They might have indicated that a piece of jewelry is only worth a few bucks when it is actually worth a lot more money. The will is a vitally important document. There may be competing claims against the estate. For example, people might have done work in the property but not been compensated by the person. This can lead to all sorts of allegations that can be quite serious.
Someone On Your Side
Having someone on your side when this happens is vitally important. The process of being audited is very scary for most people. An IRS official has a lot of power. They can decide that there’s a serious problem when you don’t agree. That is why you’ll wan to have someone on your side to help. The right legal help with an estate tax audit can result in the outcome that you want from the IRS. That will help all things flow more smoothly and make sure your legal rights are fully upheld.