Advanced Wealth Transfer Strategies

Size: px
Start display at page:

Download "Advanced Wealth Transfer Strategies"

Transcription

1 Family Limited Partnerships (FLPS) Advanced Wealth Transfer Strategies The American Taxpayer Relief Act of 2012 established a permanent gift and estate tax exemption of $5 million, which is adjusted annually for inflation. For many individuals, the inflation adjusted gift and estate tax exemption amount of $5.49 million for 2017 is likely to eliminate most, if not all of their potential estate tax liability. But individuals with larger estates, or those who would like to continue receiving income from the assets they ultimately wish to transfer, may need something more. A number of more sophisticated wealth transfer strategies enable you to transfer assets at reduced values for gift and estate tax purposes often enabling you to remove assets worth well in excess of $5.49 million from your estate without triggering gift or estate taxes. Many of these strategies also provide a predictable income stream. Their interest rate sensitivity makes it advantageous to consider these strategies now, while interest rates are low. Grantor retained annuity trusts Grantor retained annuity trusts (GRATs) are an estate freeze technique that enable you to remove future appreciation from your taxable estate. They are particularly useful to individuals who have assets that: can benefit from a valuation discount, such as a minority stake in a private company, may appreciate substantially in value, such as ownership in a company that may be sold or taken public, or generate strong cash flow, such as commercial real estate. With a GRAT, you gift property to a trust that makes periodic payments to you. The present value of the payments you receive is taken into consideration in valuing your gift for gift tax purposes. The payments may be in-kind (such as a portion of any securities you have gifted) or in cash and, if set at a level that is high enough, they can possibly reduce the value of the gift for gift tax purposes to zero. As long as you outlive the GRAT, when it terminates, any property remaining in the trust passes to the remainder beneficiaries without any additional gift or estate tax consequences. Kathryn, age 50, is a senior executive at a company that is contemplating going public through an initial public offering (IPO). Several years ago, she used her full gift exemption to establish a trust for her son, but she would like to transfer some of the company stock she owns out of her estate before the IPO. She sets up a 3-year GRAT that names her son as remainder beneficiary, and contributes shares valued at $10 million. The valuation on the shares includes a 35% discount for lack of marketability and control placing the value before the discount at $15,384,615. By having the GRAT pay her $3,508,156 each year, she is able to reduce the value of the $10 million gift to zero for gift tax purposes eliminating the need to pay any federal gift tax. If the GRAT makes the payments in-kind and the value of the shares increases 10% each year, the GRAT will hold shares with an aggregate market value of $2,612,313 after making the final payment. If the stock goes public at the end of the GRAT s term at a price that is 10% higher, the GRAT will hold shares valued at $2,873,544. Merrill Lynch Wealth Management makes available products and services offered by Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S), a registered broker-dealer, Member SIPC, and other subsidiaries of Bank of America Corporation (BofA Corp.). Investment and insurance products: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value Are Not Deposits Are Not Insured by Any Federal Government Agency Are Not a Condition to Any Banking Service or Activity

2 Kathryn Chris Kathryn GRAT: IPO at 10% Premium Pre-IPO shares valued at $10,000,000 Shares valued at $3,508,156 each year for three years Gift Tax Free GRAT: IPO at 20% Premium Pre-IPO shares valued at $10,000,000 Shares valued at $3,508,156 each year for three years GRAT $10,000,000 10% growth/year after IPO GRAT Remainder $2,873,544 (after payments to Kathryn) GRAT $10,000,000 10% growth/year after IPO Sales to intentionally defective grantor trusts Selling assets to an intentionally defective grantor trust (IDGT) can be a particularly attractive strategy for leveraging your federal gift and GST exemptions. Similar to a GRAT, an IDGT is useful for transferring assets that can benefit from a valuation discount, may appreciate substantially in value, or generate strong cash flow. With this strategy, you make an initial taxable seed gift to the trust. The trust then purchases additional assets from you that can be valued at up to nine times the value of seed gift by issuing an installment note. If you have not already used your $5.49 million 2017 federal gift tax exemption, the combined gift and sale would enable the trust to acquire assets valued at up to $54.9 million without triggering any federal gift taxes. And, if you are selling a minority stake or transferring ownership in a private company, you may be able to take maximum advantage of any available valuation discount and ultimately transfer even greater value free of federal gift taxes. Chris Gift Tax Free GRAT Remainder $3,134,755 (after payments to Kathryn) These figures and illustrations are based on an assumed discount rate of 2.6%. This rate, set by the IRS, varies monthly and must be used in determining the gift value of a GRAT. A higher or lower price for the IPO or price appreciation thereafter would change the final value of the trust property but would not affect the gift-tax consequences. If the IPO price is 20% higher, the value of the shares held by the GRAT will be $3,134,755. The GRAT enables Kathryn to transfer stock valued at over $2.8 million to a trust for her son without paying any federal gift tax. By establishing a new GRAT each year using the shares that are returned to her, Kathryn may be able to transfer additional shares free of gift and estate tax. GRATs are particularly useful for individuals who want to transfer appreciation on an asset, but may want to continue receiving some benefit from it. They are often structured with a relatively short term because the tax benefits are lost unless you outlive the GRAT. The interest rate used to value the annuity payments is determined by the IRS at the time the GRAT is established. Lower interest rates increase the present value of the annuity payments and therefore reduce the gift tax value, making the GRAT more attractive. The current low interest rates make it advantageous for anyone with appreciating assets to consider a GRAT now. In order to avoid federal gift tax consequences, however, the interest rate on the note must be at least as high as the rate set by the IRS, but the note can be structured with a balloon payment to minimize the annual payments. The note can also be refinanced to defer repayment of principal even further, if needed. It is important to note that the sale of the assets to the trust is not a taxable event. Because the trust is structured to be intentionally defective for income, but not gift tax purposes, the sale of the assets to the trust is treated as though it were a sale to yourself. No gain or loss is triggered until the assets are sold to a third party. Roger, age 60, owns a closely-held business that he believes he can eventually sell for $120 million to a company that could distribute his product more broadly. He recognizes that the $5.49 million federal gift tax exemption provides him with an opportunity to transfer an ownership stake, and the potential price appreciation on it, out of his taxable estate. A valuation firm has told him that the company is worth $90 million based on its current cash flow. 2 ADVANCED WEALTH TRANSFER STRATEGIES

3 Incorporating Life Insurance Into Your Wealth Transfer Plan Life insurance can be an attractive addition to most wealth transfer plans because of the beneficial tax treatment it receives when properly incorporated into a trust, the proceeds of life insurance are free of both income and estate taxes. This can make insurance an attractive component for providing liquidity to offset estate taxes or for heirs. Individuals using GRATs may find insurance particularly useful. A GRAT removes assets from the Grantor s taxable estate only if the Grantor outlives the term of the GRAT. As a result, individuals using GRATs often pair the GRAT with a life insurance policy that will provide funds to offset any estate taxes that might be triggered if the assets are brought back into the Grantor s taxable estate as a result of an untimely death. Roger establishes an IDGT, gifts $5 million to the trust and then sells non-voting shares valued at $50 million to the trust. The trust issues a 15-year installment note with an interest rate equal to the IRS mandated rate of 3.0% to finance the purchase of $45 million of the stock. Because the note is structured with a balloon payment, annual payments by the trust are limited to $1,350,000 for the first 14 years, with cash flow from the company being more than adequate to cover the payments. Although Roger will be taxed on any income earned by the trust assets, he won t be taxed on the interest payments he receives from the trust and won t recognize a capital gain on the sale of the shares to the trust. He won t recognize any capital gain on the transferred shares until they are sold by the trust. Three years later, when the company is sold for $120 million, the trust repays the $45 million outstanding on the note and is left with $21,666,667 in cash. 1 Roger receives a combined $98,333,333 from the sale of his remaining 44.4% stake in the company and the repayment of the $45 million note. 2 He uses a portion of those funds to pay the tax on the capital gain triggered by the sale of the company. The strategy enables him to transfer over $21.6 million in value to his children over a three-year period by using just $5 million of his $5.49 million gift tax exemption. Given the amount of assets that can be transferred to an IDGT without triggering federal gift taxes, it is often advantageous to allocate your GST exemption to the gift to the extent practical. This enables the trust to make tax-free distributions to grandchildren and future generations. Establishing the IDGT in a state such as Delaware that does not limit the duration of a trust can help you extend the term of the trust and its ability to provide tax-free payments to future generations. Roger Roger Sale to an IDGT Transfer of Shares $5,000,000 Cash Gift $5,000,000 Sale of shares valued at $50,000,000 $45,000,000 Installment Note with annual interest payments of $1,350,000 and principal payment of $45,000,000 at end of year 15 (Grantor is taxed on trust income) Sale of Company Three Years Later Repayment of Installment Note for $45,000,000 Intentionally Defective Grantor Trust Purchaser of Company $66,666,667 Shares Intentionally Defective Grantor Trust $21,666,667 (after sale and repayment of Installment Note) Illustration assumes an interest rate on the installment note of 3.0%. This rate, set by the IRS, varies monthly. A higher or lower sale price for the company ($120 million) would change the final value of the trust property but would not affect the gift tax consequences. Sale to an IDGT is often an advantageous way to leverage your gift tax exemption and remove appreciation from your taxable estate, while continuing to receive income from the transferred assets. IDGTs also offer greater flexibility than GRATs the term can be much longer because there is no requirement that you outlive the IDGT, the repayment schedule can use a balloon structure, and the note can be repaid at any time. The minimum interest rate on the note is mandated by the IRS and varies with ADVANCED WEALTH TRANSFER STRATEGIES 3

4 the note s term. Current low interest rates make a sale to an IDGT an attractive alternative for anyone who is interested in removing future appreciation from their taxable estate. Qualified personal residence trusts For individuals with a primary residence or vacation home that they would like to leave to family members, a qualified personal residence trust (QPRT) can be a useful strategy for transferring ownership in a tax-advantaged manner. With a QPRT, you transfer a personal residence to a trust, but retain the right to occupy it for a fixed period. At the end of the period, ownership passes to your designated beneficiaries. Although the transfer to the trust is a taxable gift, the value for federal gift tax purposes is reduced by your retained interest the value assigned to your ability to use the residence during the stated term. As a result, the amount of the taxable gift is generally well below the fair market value of the home. And, you can use any remaining lifetime gift tax exemption amount to offset some, or all, of the federal gift tax. Linda, age 60, transfers her vacation home, valued at $2 million, to a qualified personal residence trust set up to last 10 years. Over that period, the home appreciates 2% a year. When the trust ends, it s worth $2,437,989, and the ownership of the home is transferred to Linda s daughter. Assuming an IRS mandated interest rate of 3.0%, Linda can potentially realize estate tax savings of nearly $466, What about gift tax? Linda s top gift tax rate would be 40%. If Linda gave her home to her daughter outright, the value of the transfer for gift tax purposes would be $2,000,000. If she had already used her $5.49 million lifetime gift tax exemption, she would have to pay $800,000 in gift tax. In contrast, gifting the home in trust with the right to live in the residence for ten years reduces the taxable value of her gift to $1,270,700. As a result, the maximum amount of federal gift tax that Linda would have to pay would be $508,280 a savings of over $291,720. It s important to remember that from a legal perspective, you are giving away your home. The trust can provide a degree of flexibility, but your overall control over the residence is QPRT Grantor irrevocably transfers residence to a trust. The transfer is subject to gift tax, but all of the tax will be offset by partial use of the grantor s gift tax exemptions. Linda Linda uses rent free for term of trust Grantor pays fair market value rent once trust term ends Potential estate tax savings = $466,916 Family / Other Beneficiary Value at transfer to QPRT $2,000,000 2% appreciation for 10 years Ownership of residence is transferred to family member or other beneficiary when trust term ends These figures and illustration are based on an assumed IRS mandated rate of 3.0% and a federal estate tax rate of 40%, and assume the grantor is age 60 when the trust is created. The discount rate, set by the IRS, varies monthly and must be used in determining the gift value of a qualified personal residence trust. A higher or lower actual appreciation (than the 2% illustrated) would change the final value of the trust property and potential estate tax savings but would not affect the gift-tax consequences. Outright Gift Taxable Gift $2,000,000 Gift Tax Cost Use $2,000,000 of exemption or pay $800,000 Outright Gift vs. Gift in Trust Value at end of trust term $2,437,989 Gift in Trust Taxable Gift $1,270,700 Gift Tax Cost Use $1,270,700 of exemption or pay $508,280 effectively terminated when the trust term ends. You do have the ability to include a provision in the trust agreement that allows you to continue living in the residence after the term ends, but you must pay fair market rent to the new owner in order to avoid adverse tax consequences. Should you fail to survive the trust term, the value of the residence would be included in your estate. You should avoid using a QPRT on any property that has an outstanding mortgage as mortgage payments would be considered additional gifts to the trust. 4 ADVANCED WEALTH TRANSFER STRATEGIES

5 Charitable lead annuity trusts Individuals who are interested in philanthropy and who would like to transfer assets to beneficiaries at a reduced valuation for gift tax purposes may find a charitable lead annuity trust (CLAT) useful. With a CLAT, you gift assets to a trust that makes annual payments to charities of your choice for a designated period. The present value of the charitable payments is taken into consideration when calculating the gift tax value of the assets you transfer to the CLAT. At the end of the trust s term, any assets remaining in the trust pass to your designated remainder beneficiaries without triggering any additional federal gift or estate taxes. A low discount rate coupled with a high payout rate can substantially reduce the gift tax value of the remainder interest. Carlos would like to leave a portion of his securities portfolio to his son, but has already used his lifetime gift exemption. He creates a CLAT with $5 million worth of appreciating securities and names his son as the remainder beneficiary. The CLAT will pay his favorite charity $200,000 a year for 15 years for a total contribution of $3,000,000. If the IRS mandated discount rate is 3.0%, the charitable payments will reduce the taxable value of his gift to the trust to just $2,612,420. Assuming the trust earns an annual return of 7.5%, at the end of the 15-year term, the assets remaining in the CLAT that will pass to his son will be worth $9,570,714. If Carlos still has $1,500,000 of his lifetime gift tax exemption remaining how much could he transfer to the trust without triggering gift taxes? If he increases the annual charitable payments to $293,500, the taxable value of the portfolio will be reduced to just under $1,500,000 for federal gift tax purposes and his son will receive the $7,128,647 remaining when the trust terminates without triggering additional federal gift or estate taxes. CLAT: $200,000 Annual Charitable Gift Carlos Charitable Lead Trust $5,000,000 CLAT: $293,500 Annual Charitable Gift Carlos 7.5% growth for 15 years Value at end of trust term $9,570,714 (after payments to charity) 7.5% growth for 15 years Value at end of trust term $7,128,647 (after payments to charity) Grantor taxed on trust income $200,000 a year for 15 years = $3,000,000 Charity Children or Other Heirs Taxable gift of $2,612,420 results in transfer of $9,570,714 to heirs Charitable Lead Trust $5,000,000 Grantor taxed on trust income $293,500 a year for 15 years = $4,402,500 Tax free with use of approximately $1,500,000 of gift tax exemption amount Charity Children or Other Heirs These figures and illustrations are based on an assumed discount rate of 3.0%. The discount rate, set by the IRS, varies monthly. A higher or lower actual return (than the 7.5% illustrated) would change the final value of the trust property but would not affect the gift-tax consequences. By carefully planning and managing your giving through a CLAT, you can effectively reduce or even eliminate the federal gift tax liability on assets transferred to beneficiaries. This makes it an effective strategy for transferring appreciating assets if you have already utilized all or a portion of your lifetime gift tax exemption and are making, or plan on making gifts to charity. ADVANCED WEALTH TRANSFER STRATEGIES 5

6 Intra-family loans Intra-family loans offer an additional way to transfer future appreciation on assets without triggering gift taxes. With this strategy, you loan money to another family member, typically an adult child or grandchild, enabling him/her to purchase assets. The borrower agrees in writing to repay the principal plus interest at a rate equal to the IRS mandated rate in effect when the loan is made a rate that is typically lower than the rates on commercial loans. Because you are loaning and not gifting the money, a properly structured intra-family loan is not subject to gift tax, and any appreciation on assets purchased with the loan remains outside of your estate for estate tax purposes. You might also have the ability to reduce overall family income tax, since any income produced by the assets purchased with the loan proceeds will be taxable to the borrower typically a child or grandchild, who may be in a lower income tax bracket than you are. However, you must include the interest payments you receive in your taxable income, so this is a benefit only to the extent that the income produced by the assets is greater than the interest paid. Some families find intra-family loans an effective way to encourage younger family members to become actively engaged in and learn about investing. An intra-family loan allows the borrower to retain any income generated in excess of the loan rate, giving them incentive to become more knowledgeable about markets and skilled in their investment selections. Alex, age 72, is interested in encouraging his 21-year-old granddaughter to take a more active interest in investing. He loans Sarah $500,000 in exchange for a Note that requires her to pay interest at the 3.0% annual rate established by the IRS and repay the principal at the end of the 5-year term. If Sarah s investments appreciate 7.5% annually, she will have $130,689 left after making the interest and principal payments on the Note. Alex will have to recognize the annual interest payments as income and Sarah will have to recognize any annual income from the portfolio in excess of the annual interest payment. Alex Donor pays tax on interest income from Note. Donee pays tax on investment income in excess of Note payments. These figures and illustration are based on an assumed IRS mandated interest rate of 3.0%. The rate varies monthly. A higher IRS mandated rate on the note or a lower return on investment portfolio would change the final value remaining in the investment portfolio after repayment of the note. Private annuities Private annuities offer another potential way to transfer assets without gift tax consequences. Assets are sold in exchange for a private annuity a promise to make periodic payments for the remainder of the seller s life. As long as the present value of the expected annuity payments under IRS valuation tables equals the fair market value of the assets, the transaction is free of federal gift tax consequences. This enables the seller to remove the assets, together with any subsequent appreciation on them, from his or her taxable estate. The amount actually paid depends on the length of time the seller lives. Intra-Family Loan $500,000 5-year Note with annual interest payments of $15,000 and principal payment of $500,000 at end of term $500,000 Sarah Annual withdrawals equal to payments on Note Investment Portfolio $130,689 after loan payments assuming a 7.5% annual growth Edna is a 65-year-old widow with an actuarial life expectancy of 19.5 years. Due to some recent significant health concerns, Edna does not expect to live to the age of 85. With that in mind, she decides to transfer $1,000,000 worth of securities to her daughter, Melissa. In exchange for the securities, Melissa agrees to pay Edna an annuity of $77,259 per year, representing the fair market value of the shares calculated using an assumed IRS mandated interest rate of 3.0%. 6 ADVANCED WEALTH TRANSFER STRATEGIES

7 Eight years later, Edna dies. Assuming that the securities have an average annual return of 7.5%, and that Melissa paid the annuity (a total of $618,072) from other assets, at the end of the eight years, the shares owned by Melissa will be worth $1,783,478. As for the transfer tax consequences, the transfer is free of both federal gift and estate tax. Edna Private Annuity Annuity with annual payments of $77,259 from other assets Transfer Tax Consequences No gift tax No estate tax Securities valued at $1,000,000 Melissa 7.5% growth for eight years Value of Shares $1,783,478 These figures and illustration are based on an assumed discount rate of 3.0%. This rate, set by the IRS, varies monthly. A higher or lower actual return (than the 7.5% illustrated) would change the final value of the transaction to the donee but would not affect the gift-tax consequences. With a private annuity, the seller recognizes a gain on the sale of the property. As a result, it may be advantageous to sell securities that have a cost basis close to the current market value. By selling the asset to a grantor trust, the seller may be able to avoid recognition of a gain on the sale. Each year for income tax purposes, the seller must also recognize the portion of the annual payment that is not allocated to the gain on the sale or to return of basis. However, the purchaser is not able to deduct the corresponding amount as implied interest. Because the present value of the annuity payments is higher when the IRS mandated rate is low, the economic benefits of a private annuity are typically more attractive when interest rates are low. Summary Although the $5.49 million federal gift and GST tax exemptions provide an opportunity for many individuals to eliminate most if not all of their potential estate tax liability, individuals with larger taxable estates may find some of these more advanced wealth transfer techniques useful in minimizing gift and estate taxes. The interest rate sensitivity of many of these strategies, combined with the current tax environment make it especially advantageous to consider these strategies now, while interest rates are low. Choosing an appropriate strategy, however, depends on your individual needs and goals as well as the nature of the assets you may wish to transfer. Your financial advisor, along with an experienced trust specialist, would be pleased to meet with you, your attorney and other advisors to help assess the various alternatives and discuss how they may benefit you, your family and future generations. If a trust is decided upon, your financial advisor and trust specialist will introduce experienced trust professionals from U.S. Trust. 4 As one of the nation s leading trust organizations, U.S. Trust brings deep fiduciary knowledge as well as experience managing a wide range of sophisticated trusts. Your team of Merrill Lynch and U.S. Trust professionals will work with you and your tax and legal advisors from concept through implementation. ADVANCED WEALTH TRANSFER STRATEGIES 7

8 ml.com/legacy All guarantees and benefits of an insurance policy are backed by the claims-paying ability of the issuing insurance company. They are not backed by Merrill Lynch or its affiliates, nor do Merrill Lynch or its affiliates make any representations or guarantees regarding the claims-paying ability of the issuing insurance company. Life insurance death benefit proceeds are generally excludable from the beneficiary s gross income for income tax purposes. There are a few exceptions, such as when a life insurance policy has been transferred for valuable consideration. Merrill Lynch, U.S. Trust and their affiliates do not provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions. The case studies are intended to illustrate trust products and services available through Merrill Lynch. They are not intended to serve as investment advice since the availability and effectiveness of any strategy is dependent upon your individual facts and circumstances. They do not necessarily represent the experience of other clients, nor do they indicate future performance. Investment results may vary. The strategies presented are not necessarily appropriate for every investor. Individual clients should review with their financial advisors the terms and conditions and risks involved with specific trust products or services. 1 Assuming a $90 million valuation, the trust is able to acquire non-voting shares that represent an 55.6% ownership stake in the company. When the company is later sold for $120 million, the 55.6% interest held by the IDGT is sold for $66,666,667. After repaying the $45 million note, the trust is left with $21,666, Assumes that the remaining 44.4% stake is sold for $53,333,333. Roger receives a combined total of $98,333,333 from the sale of the stock and repayment of the $45 million note. 3 The estate tax savings are based on the difference between the gift tax value of $1,270,700 and the estimated value of the property at the end of the QPRT, $2,437, U.S. Trust is a division of Bank of America, N.A. Trust and fiduciary services are provided by U.S. Trust, a division of Bank of America, N.A., Member FDIC. Insurance products are offered through Merrill Lynch Life Agency Inc. (MLLA), a licensed insurance agency. Bank of America, N.A., MLPF&S and MLLA are wholly owned subsidiaries of BofA Corp. MLPF&S and U.S. Trust make available investment products sponsored, managed, distributed or provided by companies that are affiliates of BofA Corp Bank of America Corporation. All rights reserved. AR77HDDX Code PM-1116

Issues INSIGHTS AND. Wealth Transfer Strategies for Rising Interest Rates

Issues INSIGHTS AND. Wealth Transfer Strategies for Rising Interest Rates Issues AND INSIGHTS May 2018 Wealth Transfer Strategies for Rising Interest Rates IN THIS ARTICLE Interest rates are a key component of wealth transfer strategies, and any changes in the rates will affect

More information

HERMENZE & MARCANTONIO LLC ADVANCED ESTATE PLANNING TECHNIQUES

HERMENZE & MARCANTONIO LLC ADVANCED ESTATE PLANNING TECHNIQUES HERMENZE & MARCANTONIO LLC ADVANCED ESTATE PLANNING TECHNIQUES - 2019 I. Overview of federal, Connecticut, and New York estate and gift taxes. A. Federal 1. 40% tax rate. 2. Unlimited estate and gift tax

More information

Estate planning using life insurance

Estate planning using life insurance Estate planning using life insurance With the right life insurance strategy, you can safeguard who and what you care about, while creating opportunities for your wealth to go further. To take advantage

More information

Wealth structuring and estate planning. Your vision and your legacy. Life s better when we re connected

Wealth structuring and estate planning. Your vision and your legacy. Life s better when we re connected Wealth structuring and estate planning Your vision and your legacy Life s better when we re connected Inside 1 Helping you shape the future 2 The elements of wealth structuring 4 The power and flexibility

More information

USING IRA ASSETS TO ADDRESS YOUR WEALTH TRANSFER GOALS

USING IRA ASSETS TO ADDRESS YOUR WEALTH TRANSFER GOALS U.S. TRUST FIDUCIARY SERVICES FOR MERRILL LYNCH CLIENTS USING IRA ASSETS TO ADDRESS YOUR WEALTH TRANSFER GOALS Trusteed IRAs from U.S. Trust WHAT S INSIDE Support from Merrill Lynch and U.S. Trust Beyond

More information

TRUSTS & ESTATES ADVISORY

TRUSTS & ESTATES ADVISORY Estate Planning Techniques In A Low Interest Rate Environment Interest rates remain at historic lows and it seems that rates will not be rising as quickly as most commentators once thought. Consequently,

More information

A Unique Opportunity to Transfer Wealth Without Tax: Taking Advantage of the 2012 Gift Tax Exemption

A Unique Opportunity to Transfer Wealth Without Tax: Taking Advantage of the 2012 Gift Tax Exemption A Unique Opportunity to Transfer Wealth Without Tax: Taking Advantage of the 2012 Gift Tax Exemption By Andrew H. Friedman, The Washington Update ESTATE PLANNING SERVICES APRIL 2012 T ax provisions enacted

More information

WEALTH STRATEGIES. GRATs and Sale to IDGTs: Estate Freeze Techniques

WEALTH STRATEGIES. GRATs and Sale to IDGTs: Estate Freeze Techniques WEALTH STRATEGIES THE PRUDENTIAL INSURANCE COMPANY OF AMERICA GRATs and Sale to IDGTs: Estate Freeze Techniques FREQUENTLY ASKED QUESTIONS ESTATE PLANNING How do two of the techniques used by wealthy clients

More information

Effective Strategies for Wealth Transfer

Effective Strategies for Wealth Transfer Effective Strategies for Wealth Transfer The Prudential Insurance Company of America, Newark, NJ. 0265295-00002-00 Ed. 02/2016 Exp. 08/04/2017 UNDERSTANDING WEALTH TRANSFER What strategy to use and when?

More information

Double Discounted Transfers

Double Discounted Transfers Advanced Markets planning perspective estate planning Double Discounted Transfers The Silver Lining After the Economic Downturn It seems clear that estate taxes are here to stay. For people who are likely

More information

CLIENT ALERT - ESTATE, GIFT AND GENERATION-SKIPPING TRANSFER TAX

CLIENT ALERT - ESTATE, GIFT AND GENERATION-SKIPPING TRANSFER TAX CLIENT ALERT - ESTATE, GIFT AND GENERATION-SKIPPING TRANSFER TAX January 2013 JANUARY 2013 CLIENT ALERT - ESTATE, GIFT AND GENERATION-SKIPPING TRANSFER TAX Dear Clients and Friends: On January 2, 2013,

More information

Estate Freezing Techniques. For Producer or Broker/Dealer Use Only. Not for Public Distribution.

Estate Freezing Techniques. For Producer or Broker/Dealer Use Only. Not for Public Distribution. Estate Freezing Techniques Agenda Identify Potential Clients Qualified Personal Residence Trust (QPRT) Grantor Retained Annuity Trust (GRAT) Installment Sale to an Intentionally Defective Irrevocable Trust

More information

THE ESTATE PLANNER S SIX PACK

THE ESTATE PLANNER S SIX PACK Tenth Floor Columbia Center 101 West Big Beaver Road Troy, Michigan 48084-5280 (248) 457-7000 Fax (248) 457-7219 SPECIAL REPORT www.disinherit-irs.com For persons with taxable estates, there is an assortment

More information

DELAWARE ADVANTAGE PERSONAL TRUSTS

DELAWARE ADVANTAGE PERSONAL TRUSTS PNC Advisors DELAWARE ADVANTAGE PERSONAL TRUSTS Solutions to help you plan your clients wealth management strategies more effectively www.pncadvisors.com At PNC Advisors, we know the Delaware trust solutions

More information

Link Between Gift and Estate Taxes

Link Between Gift and Estate Taxes Link Between Gift and Estate Taxes Each is necessary to enforce the other The taxes are assessed at essentially the same rates Though, the gift tax is measured exclusively while the estate tax is measured

More information

Estate Planning Strategies for the Business Owner

Estate Planning Strategies for the Business Owner National Life Group is a trade name of of National Life Insurance Company, Montpelier, VT and its affiliates. TC74345(0613)1 Estate Planning Strategies for the Business Owner Presented by: Connie Dello

More information

Memorandum FILE. Naim D. Bulbulia, Esq. Estate Planning Primer

Memorandum FILE. Naim D. Bulbulia, Esq. Estate Planning Primer Memorandum TO FROM FILE Naim D. Bulbulia, Esq. DATE May 5, 2005 RE Estate Planning Primer The following memorandum has been prepared in order to provide you with an overview of estate and gift tax law

More information

tax strategist the A simple plan Installment sale offers alternative to complex estate planning strategies Balance competing

tax strategist the A simple plan Installment sale offers alternative to complex estate planning strategies Balance competing the May/June 2008 tax strategist A simple plan Installment sale offers alternative to complex estate planning strategies Balance competing goals with a QTIP trust Take care when choosing IRA beneficiaries

More information

Tax Planning Considerations for 2015

Tax Planning Considerations for 2015 Tax Planning Considerations for 2015 Most strategies that could have an impact on your taxes need to be made by December 31 if you want them reflected on your 2015 tax return. Executive summary As the

More information

Estate Freeze Transactions

Estate Freeze Transactions STRATEGIC THINKING The idea behind an estate freeze is to transfer value to the next generation at a low current value and to remove appreciation after the transfer date from the transferor s estate. Estate

More information

Wealth Transfer and Charitable Planning Strategies. Handbook

Wealth Transfer and Charitable Planning Strategies. Handbook Wealth Transfer and Charitable Planning Strategies Handbook Wealth Transfer and Charitable Planning Strategies Handbook This handbook contains 12 core wealth transfer and charitable planning strategies.

More information

Buy-Out Transactions: Private Wealth Considerations

Buy-Out Transactions: Private Wealth Considerations Buy-Out Transactions: Private Wealth Considerations During the period approaching and immediately following a buy-out transaction, business owners selling a company have numerous tax and wealth planning

More information

WILLMS, S.C. LAW FIRM

WILLMS, S.C. LAW FIRM WILLMS, S.C. LAW FIRM TO: FROM: Clients and Friends of Willms, S.C. Attorney Andrew J. Willms DATE: October 15, 2012 RE: Year-End Tax Planning for 2012 As you are probably well aware, most of the changes

More information

Liquidity Planning for Entrepreneurs

Liquidity Planning for Entrepreneurs Liquidity Planning for Entrepreneurs Strategies for Preserving Wealth Before and After the Transaction By Jim Raaf Managing Director One of the most important decisions faced by entrepreneurs is how to

More information

ESTATE PLANNING 1 / 11

ESTATE PLANNING 1 / 11 2 STARTING A BUSINES RETIREMENT STRATEGIE OPERATING A BUSINES MARRIAG INVESTING TAX SMAR ESTATE PLANNIN 3 What happens to my money and assets after I die? No matter what your age or income, you need to

More information

Estate Planning. Uncertain Times. IRS Circular 230 Disclosure

Estate Planning. Uncertain Times. IRS Circular 230 Disclosure Estate Planning IRS Circular 230 Disclosure To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication (including any attachments)

More information

Estate Planning in 2019

Estate Planning in 2019 CLIENT MEMORANDUM Estate Planning in 2019 January 14, 2019 The Tax Cuts and Jobs Act (the Act ), which took effect January 1, 2018, made sweeping changes to the federal tax landscape. Of particular relevance

More information

The. Estate Planner. Is now a good time for a QPRT? Trust your trustee

The. Estate Planner. Is now a good time for a QPRT? Trust your trustee The Estate Planner November/December 2009 Is now a good time for a QPRT? Transferring the family business Using a CLAT can benefit charity and your family Trust your trustee Choosing a trustee who will

More information

The Use of Pass-Through Entities in Asset Protection and Wealth Transfer Planning

The Use of Pass-Through Entities in Asset Protection and Wealth Transfer Planning The Use of Pass-Through Entities in Asset Protection and Wealth Transfer Planning DANIEL W DALY III 2323 S. Shepherd, 14 th Floor Houston, TX 77019 713-979- 4701 daly@ohdlegal.com www.ohdlegal.com Judge

More information

THE DESIGN, FUNDING, ADMINISTRATION & REPAIR OF GRATS, QPRTS & SALES TO IDGTS

THE DESIGN, FUNDING, ADMINISTRATION & REPAIR OF GRATS, QPRTS & SALES TO IDGTS THE DESIGN, FUNDING, ADMINISTRATION & REPAIR OF GRATS, QPRTS & SALES TO IDGTS The Estate Planning Council of Greater Miami October 20, 2016 Louis Nostro, Esquire Nostro Jones, P.A. Miami, Florida lnostro@nostrojones.com

More information

Temporary Estate, Gift and GST Tax Laws Provide Unprecedented Opportunities in 2012

Temporary Estate, Gift and GST Tax Laws Provide Unprecedented Opportunities in 2012 Month Year Temporary Estate, Gift and GST Tax Laws Provide Unprecedented Opportunities in 2012 BY RENEE M. GABBARD, LISA M. LAFOURCADE & MEGAN S. ACOSTA It appears that the current favorable estate, gift

More information

A Guide to Estate Planning

A Guide to Estate Planning BOSTON CONNECTICUT FLORIDA NEW JERSEY NEW YORK WASHINGTON, DC www.daypitney.com A Guide to Estate Planning THE IMPORTANCE OF ESTATE PLANNING The goal of estate planning is to direct the transfer and management

More information

Consider what estate planning is all about. In its essence, estate. Perspectives in Estate Planning

Consider what estate planning is all about. In its essence, estate. Perspectives in Estate Planning Perspectives in Estate Planning For many of us, estate planning is something we know we should do but somehow manage to postpone until some indefinite tomorrow; or, once having done a plan, put it away

More information

Leveraging wealth transfer using a sale to a defective grantor trust

Leveraging wealth transfer using a sale to a defective grantor trust Sale to a Grantor Trust Strategy Leveraging wealth transfer using a sale to a defective grantor trust Not a bank or credit union deposit, obligation or guarantee May lose value Not FDIC or NCUA/NCUSIF

More information

Estate P LANNER. the. Roll with it Keep wealth in the family using rolling GRATs

Estate P LANNER. the. Roll with it Keep wealth in the family using rolling GRATs the Estate P LANNER May/June 2006 Roll with it Keep wealth in the family using rolling GRATs Administrative checklist for after a family member passes away Tips for tax-wise charitable giving Too much

More information

Investment and Estate Planning Opportunities for High Net Worth Individuals in 2013

Investment and Estate Planning Opportunities for High Net Worth Individuals in 2013 Investment and Estate Planning Opportunities for High Net Worth Individuals in 2013 Presented By: CPA, MST, AEP Keebler & Associates, May 2, 2013 Phone: (920) 593-1701 E-mail: robert.keebler@keeblerandassociates.com

More information

Estate Planning for Small Business Owners

Estate Planning for Small Business Owners Estate Planning for Small Business Owners HOSTED BY OCEAN FIRST BANK PRESENTED BY MONZO CATANESE HILLEGASS, P.C. SPEAKER: DANIEL S. REEVES, ESQUIRE Topics Tax Overview Trust Ownership Intentionally Defective

More information

Determined by Seller (not to exceed life expectancy) Deductibility of Interest Depends on Property None

Determined by Seller (not to exceed life expectancy) Deductibility of Interest Depends on Property None chapter chapter 7 SCIN Private Annuity Term of Payment Determined by Seller (not to exceed life expectancy) Life of Annuitant Deductibility of Interest Depends on Property None Buyer s Adjusted Basis Purchase

More information

Which Asset Transfer Strategy is Right for You?

Which Asset Transfer Strategy is Right for You? Which Asset Transfer Strategy is Right for You? August 27, 2014 Larry Powell CSH Dave Benedetto Taft Mark Gaudet CSH Andy Woods Taft First Webinar: Is Estate Planning Still Important With A $5 Million

More information

Please understand that this podcast is not intended to be legal advice. As always, you should contact your WEALTH TRANSFER STRATEGIES

Please understand that this podcast is not intended to be legal advice. As always, you should contact your WEALTH TRANSFER STRATEGIES WEALTH TRANSFER STRATEGIES Hello and welcome. Northern Trust is proud to sponsor this podcast, Wealth Transfer Strategies, the third in a series based on our book titled Legacy: Conversations about Wealth

More information

Typical Succession Scenario

Typical Succession Scenario Uplifting Gifting: Using Additional Exemption to Maximize Business Succession Planning Eric Green Robert Nemzin Richard Barnes October 21, 2011 1 Typical Succession Scenario Client has substantial portion

More information

Grantor Trusts. Maine Tax Forum

Grantor Trusts. Maine Tax Forum Grantor Trusts Maine Tax Forum Jeremiah W. Doyle IV Senior Vice President BNY Mellon Private Wealth Management Boston, MA jere.doyle@bnymellon.com (617) 722-7420 November, 2017 1 Grantor Trusts AGENDA

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets january 2014 Preserving and Transferring IRA Assets Summary The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth

More information

TWO-YEAR WINDOW FOR GIFT TAX PLANNING OPPORTUNITY

TWO-YEAR WINDOW FOR GIFT TAX PLANNING OPPORTUNITY BE IN A POSITION OF STRENGTH SM WithumSmith+Brown s Tax Services Team Newsletter ESTATE & TRUST 03-04 SUCCESSION PLANNING FOR THE TRANSFER OF A BUSINESS TWO-YEAR WINDOW FOR GIFT TAX PLANNING OPPORTUNITY

More information

Qualified Personal Residence Trust (QPRT)

Qualified Personal Residence Trust (QPRT) Qualified Personal Residence Trust (QPRT) Overview A Qualified Personal Residence Trust (QPRT) can allow a homeowner to transfer a residence to other family members at a reduced gift tax cost while retaining

More information

Planning in a New Interest Rate Environment

Planning in a New Interest Rate Environment The following information and opinions are provided courtesy of Wells Fargo Bank N.A. Wealth Planning Update Planning in a New Interest Rate Environment FEBRUARY 2016 Matthew Brady Senior Director of Planning,

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets Preserving and Transferring IRA Assets september 2017 The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth potential,

More information

Estate Planning Client Guide

Estate Planning Client Guide CLIENT GUIDE Advanced Markets Estate Planning Client Guide LIFE-5711 6/17 TABLE OF CONTENTS Why Create an Estate Plan?... 1 Basic Estate Planning Tools... 2 Funding an Irrevocable Life Insurance Trust

More information

Tax Bulletin: Effectively Using a QPRT Strategy in Your Estate Plan

Tax Bulletin: Effectively Using a QPRT Strategy in Your Estate Plan Tax Bulletin: Effectively Using a QPRT Strategy in Your Estate Plan PAUL F. NAPOLEON, Senior Vice President & Head of Tax Services SAMANTHA BRIJLALL, Tax Associate Estate planning is an area of wealth

More information

Cushing, Morris, Armbruster & Montgomery, LLP. Some Tax-Efficient Ways of Making Gifts

Cushing, Morris, Armbruster & Montgomery, LLP. Some Tax-Efficient Ways of Making Gifts Cushing, Morris, Armbruster & Montgomery, LLP Some Tax-Efficient Ways of Making Gifts For wealth transfer tax planning, it is blessed to give. It is more blessed still to give while living (rather than

More information

Advanced marketing concepts. Brought to you by the Advanced Consulting Group of Nationwide

Advanced marketing concepts. Brought to you by the Advanced Consulting Group of Nationwide Advanced marketing concepts Brought to you by the Advanced Consulting Group of Nationwide Breaking down and simplifying financial planning techniques When your clients have complex estate, retirement or

More information

Grantor Retained Annuity Trusts ( GRATs ) and Rolling GRATs. Producer Guide. For agent use only. Not for public distribution.

Grantor Retained Annuity Trusts ( GRATs ) and Rolling GRATs. Producer Guide. For agent use only. Not for public distribution. Grantor Retained Annuity Trusts ( GRATs ) and Rolling GRATs Producer Guide Introduction to GRATs and Rolling GRATs The Grantor Retained Annuity Trust ( GRAT ) is a flexible planning tool which can be used

More information

Estate Planning in 2012

Estate Planning in 2012 ESTATE PLANNING IN 2012 Overview and Goals of Estate Planning in 2012 Generally, there are three basic goals of estate, generation skipping transfer, and gift tax planning: (1) the reduction of estate

More information

How the Smiths Integrated Twelve Tax Planning Tools to Minimize Taxes and Maximize Benefits for Retirement, Family, and Favorite Charities.

How the Smiths Integrated Twelve Tax Planning Tools to Minimize Taxes and Maximize Benefits for Retirement, Family, and Favorite Charities. How the Smiths Integrated Twelve Tax Planning Tools to Minimize Taxes and Maximize Benefits for Retirement, Family, and Favorite Charities. So that you can appreciate how a typical family benefits from

More information

AUSTIN CAPITAL TRUST COMPANY

AUSTIN CAPITAL TRUST COMPANY AUSTIN CAPITAL TRUST COMPANY Providing for the long-term financial security and safety of assets PROTECTING RESOURCES BY PROVIDING THE RIGHT SERVICES Austin Capital Trust Company s role is to help protect

More information

THE MAGIC OF CHARITABLE GIVING Win-Win Strategies That Benefit Both the Charity and the Donor (ILLUSTRATIONS BASED ON RATES AND TAXES FOR APRIL 2014)

THE MAGIC OF CHARITABLE GIVING Win-Win Strategies That Benefit Both the Charity and the Donor (ILLUSTRATIONS BASED ON RATES AND TAXES FOR APRIL 2014) THE MAGIC OF CHARITABLE GIVING Win-Win Strategies That Benefit Both the Charity and the Donor (ILLUSTRATIONS BASED ON RATES AND TAXES FOR APRIL 2014) Presented to: CENTENNIAL ESTATE PLANNING COUNCIL November

More information

Framing Your Legacy. With Transfer Tax Certainty, It Is Time to Consider Your Estate And Life Insurance Planning MKT13-65

Framing Your Legacy. With Transfer Tax Certainty, It Is Time to Consider Your Estate And Life Insurance Planning MKT13-65 Framing Your Legacy With Transfer Tax Certainty, It Is Time to Consider Your Estate And Life Insurance Planning MKT13-65 This material is not intended to be used, nor can it be used by any taxpayer, for

More information

When interest rates are low, it s high time for estate planning. Asset protection: Back to basics

When interest rates are low, it s high time for estate planning. Asset protection: Back to basics Insight on Estate Planning When interest rates are low, it s high time for estate planning Asset protection: Back to basics Trusts and taxes Understanding how one affects the other can benefit your estate

More information

What s News in Tax. To Plan or Not to Plan? Estate Planning during Unpredictable Times. Analysis that matters from Washington National Tax

What s News in Tax. To Plan or Not to Plan? Estate Planning during Unpredictable Times. Analysis that matters from Washington National Tax What s News in Tax Analysis that matters from Washington National Tax To Plan or Not to Plan? Estate Planning during Unpredictable Times February 20, 2017 by Scott Hamm and Tracy Thomas Stone, Washington

More information

GRANTOR RETAINED ANNUITY TRUSTS

GRANTOR RETAINED ANNUITY TRUSTS GRANTOR RETAINED ANNUITY TRUSTS A Private Clients Group White Paper Grantor Retained Annuity Trusts are one estate planning tool used to reduce inheritance taxes by removing assets from an estate. A Grantor

More information

THE SCIENCE OF GIFT GIVING After the Tax Relief Act. Presented by Edward Perkins JD, LLM (Tax), CPA

THE SCIENCE OF GIFT GIVING After the Tax Relief Act. Presented by Edward Perkins JD, LLM (Tax), CPA THE SCIENCE OF GIFT GIVING After the Tax Relief Act Presented by Edward Perkins JD, LLM (Tax), CPA THE SCIENCE OF GIFT GIVING AFTER THE TAX RELIEF ACT AN ESTATE PLANNING UPDATE Written and Presented by

More information

Reunion Weekend 2018

Reunion Weekend 2018 Presented by B. Howard Pearson, J.D. Lecturer, Stanford University Law School Development Legal Counsel and Senior Philanthropic Advisor Stanford University Reunion Weekend 2018 2 Changes Affecting Estate

More information

Personal Trust Services

Personal Trust Services Personal Trust Services Morgan Stanley Trust National Association 1 Morgan Stanley Trust, N.A. is dedicated to providing comprehensive and customized trustee services to wealthy families. As an experienced

More information

Charitable Giving Techniques

Charitable Giving Techniques Life Event Services Estate Planning Charitable Giving Techniques Giving to charity used to be as simple as writing a check or dropping off old clothes at a charitable organization. But this type of giving,

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets AUGUST 2016 Preserving and Transferring IRA Assets SUMMARY The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth

More information

TRUST AND ESTATE PLANNING GLOSSARY

TRUST AND ESTATE PLANNING GLOSSARY TRUST AND ESTATE PLANNING GLOSSARY What is estate planning? Estate planning is the process by which one protects and disposes of his or her wealth, sometimes during life and more often at death, in accordance

More information

Wealth Transfer. Shark Fin CHARITABLE LEAD ANNUITY TRUST

Wealth Transfer. Shark Fin CHARITABLE LEAD ANNUITY TRUST Wealth Transfer Shark Fin CHARITABLE LEAD ANNUITY TRUST 2 SHARK FIN: CHARITABLE LEAD ANNUITY TRUST Shark Fin CLAT EXECUTIVE SUMMARY A Charitable Lead Annuity Trust (CLAT) pays a fixed amount of the trust

More information

Viewpoint. Using a Trusteed IRA to Protect, Preserve and Control Your IRA Assets

Viewpoint. Using a Trusteed IRA to Protect, Preserve and Control Your IRA Assets Viewpoint NATALIE B. CHOATE JULY 2017 Using a Trusteed IRA to Protect, Preserve and Control Your IRA Assets The first IRAs were created in 1975 and contained no more than that year s maximum contribution

More information

Estate Planning under the New Tax Law

Estate Planning under the New Tax Law Tax, Benefits, and Private Client JANUARY 2018 NO. 1 Estate Planning under the New Tax Law This client alert is part of a special series on the Tax Cuts and Jobs Act and related changes to the tax code,

More information

Charitable Giving Techniques

Charitable Giving Techniques Charitable Giving Techniques Helping achieve your charitable and estate-planning goals Trust Tip A trust can be thought of as having two parts an income interest and a remainder interest. The income interest

More information

Planning Your Exit: Strategies for Real Estate Investors to Mitigate Capital Gains

Planning Your Exit: Strategies for Real Estate Investors to Mitigate Capital Gains Planning Your Exit: Strategies for Real Estate Investors to Mitigate Capital Gains EXECUTIVE SUMMARY For individuals who wish to sell appreciated investment real estate, there are a variety of strategies

More information

IMPACT. March/April Transferring ownership while retaining control A GRAT or IDIT can help. 529 plans: Fund college costs the tax-advantaged way

IMPACT. March/April Transferring ownership while retaining control A GRAT or IDIT can help. 529 plans: Fund college costs the tax-advantaged way tax March/April 2015 IMPACT Transferring ownership while retaining control A GRAT or IDIT can help 529 plans: Fund college costs the tax-advantaged way Deferred compensation Are you in compliance with

More information

M&A Adding Value Through Pre-Sale Planning WS151896

M&A Adding Value Through Pre-Sale Planning WS151896 M&A Adding Value Through Pre-Sale Planning Value Drivers That Drive Premium Valuation 3 Value Drivers That Drive Premium Valuation U.S. M&A Activity 2017 4 Value Drivers That Drive Premium Valuation Median

More information

Maximizing Your Business s Value How Presale Tax Planning Increases Your Return

Maximizing Your Business s Value How Presale Tax Planning Increases Your Return Maximizing Your Business s Value How Presale Tax Planning Increases Your Return By Bill Nicholson and William J. Butler In working with individuals who have sold or are contemplating the sale of their

More information

Wealth Management Questionnaire

Wealth Management Questionnaire Wealth Management Questionnaire Your Name(s) Date Financial Advisor/Team Name Financial Advisor/Team Phone Number Financial Advisor Email INCLUDED IN THIS QUESTIONNAIRE: Personal Information page 3 Goals

More information

Wealth Transfer Planning in 2012: Perfect Storm of Opportunity

Wealth Transfer Planning in 2012: Perfect Storm of Opportunity Wealth Transfer Planning in 2012: Perfect Storm of Opportunity 04.23.2012 04.23.2012 NEWS BY: FARHAD AGHDAMI 2012 may present the single greatest opportunity for wealth transfer planning in recent memory.

More information

Family Business Succession Planning

Family Business Succession Planning Raymond James Financial Services, Inc. Frank Bugh Branch Manager 345 Owen Lane Suite 134 Waco, TX 76710 254-776-9330 Frank.Bugh@RaymondJames.com www.raymondjames.com/waco Family Business Succession Planning

More information

Tax Bulletin: 2017 Year-End Tax Planning Considerations

Tax Bulletin: 2017 Year-End Tax Planning Considerations Tax Bulletin: 2017 Year-End Tax Planning Considerations PAUL F. NAPOLEON, Senior Vice President & Head of Tax Services On December 2, 2017, the full Senate passed its amended version of the Tax Cuts and

More information

CHARITABLE GIFTS. A charitable gift has a number of different tax benefits, which benefits differ if the gift is made during life or at death.

CHARITABLE GIFTS. A charitable gift has a number of different tax benefits, which benefits differ if the gift is made during life or at death. CHARITABLE GIFTS Charitable Gifts As stated on this website, the current applicable exclusion amount is $5,490,000. This amount will be increased annually for inflation. If an individual dies with an estate

More information

Trusts & Estates Notes

Trusts & Estates Notes Trusts & Estates Notes A Series of Articles on Legal Issues Regarding Estate Planning and Estate Administration Factors to Consider Before Making Gifts By Michael Curtis mcurtis@thoits.com This article

More information

11/9/2012. Estate and Charitable Planning Before the End of IRS Circular 230. Historical Estate Tax Rates and Exemptions

11/9/2012. Estate and Charitable Planning Before the End of IRS Circular 230. Historical Estate Tax Rates and Exemptions Estate and Charitable Planning Before the End of 2012 SOL S. REIFER, J.D., LL.M. KYLE C. POST, J.D., LL.M. WRIGHT GINSBERG BRUSILOW P.C. 14755 PRESTON ROAD, SUITE 600 DALLAS, TEXAS 75254 972-788-1600 sreifer@wgblawfirm.com

More information

Private Company Owner Exit Strategy: Window of Opportunity. Joseph Sleeth, Partner

Private Company Owner Exit Strategy: Window of Opportunity. Joseph Sleeth, Partner Private Company Owner Exit Strategy: Window of Opportunity Joseph Sleeth, Partner 713 651 5527 jsleeth@fulbright.com Wealth Transfer Planning JOE SLEETH, PARTNER TRUSTS & ESTATES 2 Estate Tax Estate Tax

More information

Using Advanced Irrevocable Trusts for Income and Estate Tax Savings: Making 2012 Count

Using Advanced Irrevocable Trusts for Income and Estate Tax Savings: Making 2012 Count Using Advanced Irrevocable Trusts for Income and Estate Tax Savings: Making 2012 Count The next nine months are an exceptional window of opportunity for your clients to make family wealth transfers. The

More information

Program Guidelines. Bank of America Charitable Gift Fund CONTRIBUTIONS TO THE BANK OF AMERICA CHARITABLE GIFT FUND

Program Guidelines. Bank of America Charitable Gift Fund CONTRIBUTIONS TO THE BANK OF AMERICA CHARITABLE GIFT FUND Bank of America Charitable Gift Fund Program Guidelines The following document outlines the Guidelines that govern the Bank of America Charitable Gift Fund (Charitable Gift Fund) including contributions,

More information

Charitable Trusts. Charitable Trusts

Charitable Trusts. Charitable Trusts Charitable Trusts Charitable Trusts Gifts to charitable trusts can be during lifetime or at the time of death. Charitable trusts provide an income interest to a person, persons, or charities for a period

More information

Individual year-end planning and tax law updates

Individual year-end planning and tax law updates Individual yearend planning and tax law updates October 29, 2013 Baker Tilly refers to Baker Tilly Virchow Krause, LLP, an independently owned and managed member of Baker Tilly International. 1 Presenters

More information

Creates the trust. Holds legal title to the trust property and administers the trust. Benefits from the trust.

Creates the trust. Holds legal title to the trust property and administers the trust. Benefits from the trust. WEALTH STRATEGIES THE PRUDENTIAL INSURANCE COMPANY OF AMERICA Understanding the Uses of Trusts WEALTH TRANSFER OVERVIEW. The purpose of this brochure is to provide a general discussion of basic trust principles.

More information

Charitable Planning CLIENT GUIDE

Charitable Planning CLIENT GUIDE Charitable Planning CLIENT GUIDE CHARITABLE PLANNING Giving to charity can provide many benefits and opportunities, both to the charity and to you. The charity, benefits from a donation that can help further

More information

Issues AND. Tax-Powered Philanthropy: Doing well by doing good

Issues AND. Tax-Powered Philanthropy: Doing well by doing good Issues AND INSIGHTS February 2015 Tax-Powered Philanthropy: Doing well by doing good IN THIS ARTICLE Higher tax rates offer greater potential savings from charitable giving Strategies such as outright

More information

GIFTING. I. The Basic Tax Rules of Making Lifetime Gifts[1] A Private Clients Group White Paper

GIFTING. I. The Basic Tax Rules of Making Lifetime Gifts[1] A Private Clients Group White Paper GIFTING A Private Clients Group White Paper Among the goals of most comprehensive estate plans is the reduction of federal and state inheritance taxes. For this reason, a carefully prepared Will or Revocable

More information

Comprehensive Charitable Planning

Comprehensive Charitable Planning Advanced Markets Client Guide Comprehensive Charitable Planning Charitable gifts that preserve personal wealth. Comprehensive Charitable Planning Giving to charity can provide many benefits and opportunities,

More information

Estate Planning. Insight on. Tax Relief act provides temporary certainty for your estate plan

Estate Planning. Insight on. Tax Relief act provides temporary certainty for your estate plan Insight on Estate Planning February/March 2011 Tax Relief act provides temporary certainty for your estate plan 3 postmortem strategies that add flexibility to your estate plan Can a SCIN allow you to

More information

Federal Estate and Gift Tax and Use of Applicable Exclusion Amount 3. Pennsylvania Inheritance Tax 5. Gifting Techniques 6

Federal Estate and Gift Tax and Use of Applicable Exclusion Amount 3. Pennsylvania Inheritance Tax 5. Gifting Techniques 6 Prepared by Howard Vigderman Last Updated August 8, 2016 Federal Estate and Gift Taxes, Pennsylvania Inheritances Taxes and Measures to Reduce Them 2 Even with the federal estate tax exemption at an historically

More information

Charitable remainder trusts and life insurance

Charitable remainder trusts and life insurance Life insurance Allianz Life Insurance Company of North America Charitable remainder trusts and life insurance (R-3/2018) Estate planning with highly appreciated assets When designed properly, a trust can

More information

CIO Educational Series

CIO Educational Series CIO Educational Series The Capital Gains Dilemma OCTOBER 2018 Why investors should start thinking strategically about capital gains and taxes The current bull market, almost a decade long, has left many

More information

Benefits of Establishing a Qualified Personal Residence Trust (QPRT) For Your Personal Residence

Benefits of Establishing a Qualified Personal Residence Trust (QPRT) For Your Personal Residence Benefits of Establishing a Qualified Personal Residence Trust (QPRT) For Your Personal Residence What is a Qualified Personal Residence Trust? Often a taxpayer desires to give away assets from his or her

More information

Advanced Sales White Paper: Grantor Retained Annuity Trusts ( GRATs ) & Rolling GRATs

Advanced Sales White Paper: Grantor Retained Annuity Trusts ( GRATs ) & Rolling GRATs Advanced Sales White Paper: Grantor Retained Annuity Trusts ( GRATs ) & Rolling GRATs February, 2014 Contact us: AdvancedSales@voya.com This material is designed to provide general information for use

More information

Life Insurance-Premium Financing BY MATT HEALY MANAGING DIRECTOR, CLIENT RISK MANAGEMENT

Life Insurance-Premium Financing BY MATT HEALY MANAGING DIRECTOR, CLIENT RISK MANAGEMENT Life Insurance-Premium Financing BY MATT HEALY MANAGING DIRECTOR, CLIENT RISK MANAGEMENT Investment and insurance products are: NOT A DEPOSIT NOT FDIC INSURED MAY LOSE VALUE NOT BANK GUARANTEED NOT INSURED

More information

Family Business Succession Planning

Family Business Succession Planning Corbenic Partners 1525 Valley Center Parkway Suite 310 Bethlehem, PA 18017 610-814-2474 www.corbenicpartners.com Family Business Succession Planning June 1, 2017 Page 1 of 9, see disclaimer on final page

More information

QUALIFIED PERSONAL RESIDENCE TRUST ( QPRT ) General Planning Memorandum

QUALIFIED PERSONAL RESIDENCE TRUST ( QPRT ) General Planning Memorandum QUALIFIED PERSONAL RESIDENCE TRUST ( QPRT ) General Planning Memorandum What is a QPRT? A qualified personal residence trust ( QPRT ) is a technique which allows the owner of a personal residence to give

More information