April 18, 2023: Nothing Is Certain Except Death and Taxes

April 18, 2023: Nothing Is Certain Except Death and Taxes

By Melinda Gustafson Gervasi

April 14, 2023 

This year "tax day" , the deadline by which individuals must file their federal income taxes for 2022, falls on Tuesday, April 18th.  If that strikes you as "off", you would be correct.  Normally this day falls on April 15th, but in 2023 the 15th is a Saturday.  One might expect for the deadline to be the next business day, assuming it is Monday, April 17th.  However, April 17th is a holiday in Washington, D.C. (Emancipation Day). Leaving us with a federal income tax filing deadline of Tuesday, April 18th.  Phew, this got complicated quickly and it's just the calendar, not the tax code itself.

When updating or creating an estate plan, many Americans focus their efforts on minimizing gift or estate taxes.  Many never think about the income tax; they'll be dead, how could the income tax be an issue they may wonder.  If you own traditional retirement accounts that are then inherited at your death, the person inheriting them will likely have to pay income taxes on the distributions.  There are exceptions, and complicated ones because this is the federal tax code.   If you want to minimize the potential tax burden on your loved ones, schedule an appointment with your CPA to learn about what retirement accounts of your may trigger an income tax and what that impact might be.  

...in this world, nothing is certain except death and taxes. - Benjamin Franklin

 Thank you for reading, and remember that a blog is intended to spark thought and refelction.  It is not legal advice or a subsitute for a CPA.  Please consult a licensed professional in your home state to get advice specific to your situation.