When engaging in long-term care planning, it is important to consider the financial aspects of everything you plan. For example, the issue of state taxes is a complex issue that needs to be addressed when considering your plans for estate planning. If you don’t consider the ramifications of this issue, your loved ones are left trying to figure their way through this complex system.

In some states, this is very much the reality and estate taxes can often each into a hefty portion of the estate’s financial assets. However, when it comes to Arizona estate tax, it is important to know that the state does not collect its own state estate taxes. This means that in this state, this is not an issue that poses a threat to a person’s estate.

Arizona Estate Taxes

However, this was not always the case in this southwestern state. Prior to 2005, just seven years ago, the state did have an estate tax in effect, which was dubbed the “pick up tax.” This particular tax was equal to a portion of the federal tax bill for estate. The gist of this tax was the state could collect based on what the IRS allowed for on a federal return for estate taxes. Each state was able to collect an amount based on whatever their own laws stipulated when it came to estate taxes. Therefore, Arizona would be allowed to apply owed Arizona estate tax for a deceased person to that person’s estate.

However, the state repealed this law and in 2006, made it permanent that Arizona estate tax laws would be permanently repealed. This means when you are planning your estate in this state, in particular, you don’t have to worry about your loved ones needing to grapple with paying an Arizona estate tax while trying to deal with their loss and the sorting of your specific estate particulars.

Rather, you can focus the specifics of your estate planning on getting your financial affairs in order and properly for your long-term care needs. This kind of planning takes the onus off of your loved ones trying to figure out what you may have wanted and how to handle your estate after your passing. Moreover, if you know ahead of time that you don’t have to worry about an Arizona estate tax, your loved ones won’t be left to do the legwork following your passing if they don’t have that same information.

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If you are not sure as to what legal document you currently have contact one of our professionals to help you with your estate planning. They will make sure you have all of your grounds covered and have the right legal documents that best suite your wants and needs.

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