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August 25, 2017

How To Reduce or Eliminate Estate Taxes Summary Chart

    1. If Married, Use Both Exemptions
      Living Trust with Tax Planning

      • Uses both spouses’ estate tax exemptions, doubling the amount protected from estate taxes and saving a substantial amount for your loved ones.
    2. Remove Assets From Estate
      Make Annual Tax-Free Gifts

      • Simple, no-cost way to save estate taxes by reducing size of estate
      • $13,000 ($26,000 if married) each year per recipient (amount tied to inflation)
      • Unlimited gifts to charity and for medical/educational expenses paid to provider

      Transfer Life Insurance Policies to Irrevocable Life Insurance Trust

      • Removes death benefits of existing life insurance policies from estate
      • Included in estate if you die within three years of transfer

      Qualified Personal Residence Trust

      • Removes home from estate at discounted value
      • You can continue to live there

      Grantor Retained Annuity Trust / Grantor Retained Unitrust

      • Removes income-producing assets from estate at discounted value
      • You can continue to receive income

      Limited Liability Company / Family Limited Partnership

      • Lets you start transferring assets to children now to reduce your taxable estate
      • Often discounts value of business, farm, real estate or stock
      • Can protect the assets from future lawsuits, creditors, spouses
      • You keep control

      Charitable Remainder Trust

      • Converts appreciated asset into lifetime income with no capital gains tax
      • Saves estate taxes (asset out of estate) and income taxes (charitable deduction)
      • Charity receives trust assets after you die

      Charitable Lead Trust

      • Removes asset from your estate, saving estate taxes
      • Income goes to charity for set time period, then trust assets go to loved ones
    3. Buy Life Insurance Through Irrevocable Life Insurance Trust
      • Can be inexpensive way to pay estate taxes and/or replace charitable gifts
      • Death benefits not included in your estate

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