True. To calculate estate taxes, the value of the estate is calculated by deducting all debts, such as burial costs, from the value of all assets, such as a property.
Some trusts are governed by their own system of inheritance tax. The assets are no longer liable to inheritance tax upon your death once they have been effectively transferred into trust. Others have higher rates of income and capital gains tax. Therefore, it's crucial to understand what kind of trust you have. Your choice of trust will rely on what you want it to do. The simplest form of trust is bare trust. Interest in possession trusts allow the beneficiary to receive income immediately from the trust without having a claim to the money, assets, or investments that provide that income. Discretionary trusts give the trustees complete control over how to allocate the trust's assets to the beneficiaries specified therein.
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