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You can protect your family wealth with smart tactics now

On Behalf of | Dec 11, 2017 | Estate Planning And Probate |

If you’ve struggled, sacrificed and amassed a sizable fortune during your lifetime — or parlayed a little bit of money into a lot through clever entrepreneurship and investing — the last thing you want to do is have a huge chunk of that money end up in the hands of the Internal Revenue Service (IRS) when you die.

While the current Administration plans to nix estate taxes altogether by 2024, right now you still have to look at other options:

1. Give cash gifts

Handing off small amounts ($14,000 if you’re single and $28,000 for married couples who file a joint return) to your heirs each year may not seem like it will do much to avoid the taxes if you’re dealing with millions — but it can add up if you include all of the relatives or friends you want to see benefit from your estate.

Plus, you get the added satisfaction of seeing your heirs enjoy the gift while you’re still alive. Just keep your gifting to below the federal lifetime giving limit ($5.49 million total) and you’ll avoid the taxes.

2. Be charitable

As long as you reduce your estate to below the threshold for taxation — which is the same as the lifetime limit on cash gifts — you’ll avoid estate taxes.

You can create charitable trusts that not only give you a tax break now, they shield your estate from taxes later. Get some experienced legal advice so that you can decide exactly what type of trust is right for you.

3. Use life insurance

You can actually fund irrevocable life trusts through insurance, which are generally not taxable proceeds.

However, you do give up control of the assets entirely and there are other restrictions that could cause any trust to end up taxed as part of your estate anyhow.

These are only some of the options available to you. Explore more options for wealth protection as soon as possible since early planning makes it easier to do more.


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