In New York State are pre-paid funeral arrangements tax deductable?

Question

I am looking to make some basic pre-paid cremations plans to avoid a financial burden on my relatives. Is this a legitimate tax dedection in NY State? My research says 'no' with the IRS. P.s. All rude and snotty answers will be reported, so take it elsewhere.

Answer 1

I do not believe any prepaid or other actual funeral expenses are deductable in any state. They are considered in the evaluation of the estate, so make sure you set aside money for your funeral and burial which will reduce the value of the estate to be probated. Hope this is neither rude or snotty.

Answer 2

No, there is no deduction for that. And in most cases the prepaid costs are not included as deductions from the estate so if your estate's value exceeds the exemption amount for the Estate Tax when you die it cannot be used to reduce the value of the estate and therefore the taxes due. Only excess costs not covered by the plan can be deducted from the value of the estate.

Also, before spending money on those plans, be aware that they are a major souce of consumer complaints in many states. Check out the plan carefully with your state's Consumer Protection Division before investing.

Some things to consider are what happens if the funeral home offering the plan goes bankrupt or simply ceases to trade? Is the plan backed by a well-rated insurance company that will cover the costs or is your family simply out of luck?

Another consideration is that many of these plans fail to take the ravages of inflation into consideration. One that will cover your costs if you die next week may be comparitively worthless in 25 years. Also your family will be stuck with dealing with the funeral home that issued the policy and won't be able to shop around for the best deals. True, many grieving family members fail to realize in such stressful times that they can shop around and negotiate but it's usually best if there are independent sources of funds that will allow them to do so.

If you are young, in good health and tobacco-free a better option may well be a 20, 30 or even 40 year term life insurance policy. The premiums will be very low and the funds can be used by your loved ones to cover your final expenses along with other money to replace the loss of your income. Even if you are elderly and infirm there are insurance policies that offer sufficient benefits to cover burial or cremation costs at reasonable rates.

Answer 3

in the event that they stopped merchandising the sugar cereals no person might purchase them and that they might flow out of business enterprise. What i don't get is why you will possibly pay that lots for a container of sugar lined pencil shavings while a banana is greater filling and healthful. parents are the two retarded, or provide in too difficulty-free to the calls for of their babies. so some distance as soda. many persons are addicted, and could no longer nicely known it. so some distance as giving the youngster a enhance, in case you pay interest to the classified ads it says (sugar lined cereal) is an element of this finished breakfast. in case you seem on the breakfast they have orange juice, fruit and toast. you will get rid of the cereal and nevertheless be left with an entire breakfast. i in my opinion am adversarial to taxing issues for the sake of taxing issues.

Answer 4

Your research is correct - no deduction.