Preparing for the Future
Although California has no estate tax, the federal estate tax bite can be substantial enough to justify careful planning for estate tax liabilities. The larger your estate, the more carefully you must plan and choose from many options, depending on your specific circumstances and objectives.
For experienced and insightful advice and custom estate plans that will help you meet your wealth preservation and asset transfer goals while minimizing or avoiding estate tax liability, contact our estate tax planning attorneys at Thompson Von Tungeln.
Cutting Your Tax Liability
Our estate plan solutions may involve any of the following approaches to cut your future tax liability down to size:
- Use of revocable living trusts and irrevocable life insurance trusts to transfer assets out of your estate while maintaining control and beneficial use
- Qualified personal residence trusts, especially where your primary residence represents a significant asset within a larger net worth profile
- A/B bypass trusts, dynasty trusts, and generation skipping trusts to avoid and manage the complications presented by California community property law
- Charitable remainder trusts, charitable lead trusts, or gifts
- Community property agreements, prenuptial agreements, and postnuptial agreements
A Dual Approach to Managing Liability
There are essentially two main approaches to managing estate tax liability: transferring assets out of your estate through trusts or gifts and maximizing the value of your federal estate tax exemptions. Some of the instruments described above emphasize only one approach, while several cover both. What's right for you will depend upon your broader estate planning goals, the characteristics of your family, and the nature and value of the particular assets you hold.
An important feature of sound estate tax planning is integrating tax management strategies into a broader estate plan without overwhelming or distorting it. Unintended and unfortunate consequences, such as the disinheritance of one's own children, can result from too close a focus on tax planning without sufficient attention to your other wealth transfer objectives.
At Thompson Von Tungeln, our estate planning attorneys have the necessary experience and understanding of tax planning to find the custom estate planning solutions that are right for your situation.