Browsing articles in "Estate Planning"

Business Succession Planning

As hard as it may seem to believe, only 10-20% of small business owners have any kind of succession plan in place. Even more startling, less than 27% of family owned businesses transfer successfully to the next generation. If your goal is to protect your business asset, so that in the event of your death, [Read the Rest]

The Advantage of Using an Installment Sale to a Grantor Trust

In the estate planning world, one of the goals is to move appreciating assets down to the next generation and if possible, avoid capital gains taxes while the assets grow. The use of an installment sale to a Grantor trust (ISGT) could play a key role in future generational planning. The tradeoff in using an [Read the Rest]

Dying Without a Will or Trust

The act of dying without a will is called intestacy.  The distribution under the laws of intestacy will vary from the wishes of the deceased.  Putting off planning in the hopes that the laws of intestacy will meet the deceased’s wishes will prove nothing more than false hope. When a person passes without a will, [Read the Rest]

Historic Low AFRs Provide Wealth Transfer Possibilities

With the low current interest rate environment and the published IRS applicable federal rates (AFR), we are witnessing phenomenally low rates such as 1.9% for long term, nine years or more.  The advantage of this low AFR is the utilization of certain techniques that leverage the low interest rate when compared to the same techniques [Read the Rest]

How to Avoid the Reciprocal Trust Doctrine

Often times when irrevocable trusts are created for the benefit of husband and wife, the “reciprocal trust doctrine” may rear its ugly head. The doctrine applies to trusts that have substantially identical terms and are part of the same transaction; such as when a husband and wife create two irrevocable insurance trusts at the same [Read the Rest]

Why Estate Planning Now?

Why would somebody want to do estate planning under the American Tax Relief Act of 2012 (ATRA) if their estate was below $10,500,000? ATRA, in essence, alleviated any estate tax concerns for all estates under $10,500,000, indexed going forward. In 2014 the total per person is $5,340,000. There are many non-tax reasons for succession/estate planning [Read the Rest]

Trust Protector

The use of an irrevocable trust is probably one of the most effective estate planning strategies.  A primary advantage is they allow you to remove significant amounts of wealth from your taxable estate while at the same time retaining the right to receive an income stream. One of the big drawbacks to using an irrevocable [Read the Rest]

Transferring Properties Amongst Family Members: The New Tax Trap

Current tax laws provide an unprecedented opportunity allowing for the transfer of $5,120,000. On top of this phenomenal transfer of wealth opportunity, the law also allows each person to make annual gifts up to $13,000 to any donee without having to report to the IRS. To this end, in many of my discussions with clients [Read the Rest]

To Sell or Not Prior to 2013

With the new tax laws potentially changing in 2013, the question is whether you should sell appreciated capital assets in 2012 to take advantage of the lower rates and the 15% Federal tax rate as compared to the potential 23.8% tax in 2013. This is a tax increase of 58.67% over the current level. The [Read the Rest]

Special Needs Trusts

Planning for the Beneficiary with Special Needs Since many individuals with special needs are unable to obtain needed health coverage other than through Medical Assistance, it has become common place to try and avoid the disqualification for critical public benefits when planning the estate. The Social Security Act was amended in 1993 to permit the [Read the Rest]

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