Individuals with taxable estates can see significant benefits from advanced estate planning. Taking estate planning beyond the basic fundamental estate plan can minimize, and in some cases eliminate, estate taxes after death. In addition, the advanced estate plan can be a great method of perpetuating family values and protecting assets so they will be there to benefit future generations.
3 Reasons to Put Advanced Estate Planning in Place:
To Reduce Estate Taxes: This is typically accomplished through the gifting of assets directly to loved ones, charity, a trust, etc. Interests in closely held business entities (LLCs or corporations) are also “gifted” away. This can reduce the value of the owner’s estate as once these assets have been gifted away, they are no longer counted amongst the owner’s estate for estate tax purposes.
To Create a Legacy: Different types of trusts can be established in order to minimize (or eliminate) taxes. But trusts can also be used to create an ongoing legacy for future generations. In many states, trusts can legally continue for hundreds of years or even in perpetuity. This enables dynasty trusts to be established for both current family members and future family members as a part of an advanced estate plan. Some even choose to include the necessary advanced estate planning to create a legacy in their community through charitable trusts or private foundations established to provide perpetual endowments in coming years.
To Keep Assets Safe: Many advanced estate plans include advanced trusts such as the Spousal Lifetime Access Trust (SLAT). It not only minimizing (or eliminates) estate taxes, but it provides an added bonus of offering protection to the assets owned by the trust. This type of trust protects assets against lawsuits and divorce decrees specifically.
If you have questions about how an advanced estate plan can protect your assets, reduce your taxes or create a legacy for you to leave behind, please get in touch with one of the experienced Arizona estate planning attorneys at Sheridan Larson, PLLC.