Many Michigan residents who acquire a considerable amount of wealth want to put that wealth to good use. Whether that use is providing for themselves and their family, supporting charitable organizations or helping new business ventures, the possibilities are often endless. Of course, if individuals have an amount of wealth that exceeds the estate tax exemption, they may worry that their assets will be diminished due to taxation after their passing.
Fortunately, if parties do have concerns about this possibility, they do not have to resign themselves to the government taking a portion of their wealth and family’s future inheritance for tax purposes. Instead, they could explore their options for reducing the value of their estate. Many of these options can allow the assets to go to good use of the individual’s choosing.
Some common and valuable options to consider for reducing estate taxing include the following:
- Making charitable donations to organizations that the individual feels drawn to, which could be accomplished through charitable lead trusts or charitable remainder trusts
- Creating other trusts that could remove assets from the taxable estate while keeping the distribution of those assets under the instruction of the person creating the trust and managed by a trustee
- Gifting assets while the individual is still living
Having control over their acquired wealth and assets is often attractive to most Michigan residents, which is why many who might exceed the estate tax exemption would like to find ways to prevent the reduction of their wealth. As these examples show, there are various ways in which interested parties could ensure that their assets are distributed and put to use as they see fit. Discussing these and other options with experienced estate planning attorneys may be useful for finding the best method for an individual case.
