Estate Planning
In estate planning, managing the inheritance of Individual Retirement Accounts (IRAs) involves critical decisions that can significantly impact the tax implications and distribution strategies for beneficiaries. This article examines the differences between IRA conduit trusts and accumulation trusts, focusing on their structure, tax treatment, benefits, and considerations. By analyzing these two types of trusts, estate…
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Creating an estate plan is crucial for safeguarding your assets and ensuring your loved ones are protected. However, several common pitfalls can hinder the effectiveness of your estate plan. Here are key mistakes to avoid: Failing to Create an Estate Plan: Neglecting to create an estate plan is a significant mistake. Intestate succession laws in…
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On November 11, 2023, the U.S. Treasury Department issued Rev. Proc. 2023-34 releasing the 2024 inflation-adjusted exemptions for estate, gift, and generation-skipping transfer tax as follows: The estate and gift exemption amount (currently $12.92 million in 2023) will increase to $13.61 million per taxpayer for 2024 ($27.22 million per married couple). The generation-skipping transfer tax…
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Irrevocable trusts, by design, are meant to remain unchanged. However, life’s unpredictability and evolving legal landscapes can sometimes necessitate alterations. More commonly, at the death of a revocable or “living” trust’s creator, their trust immediately becomes irrevocable. In addition, trusts created under a person’s last will and testament (testamentary trusts) are likewise irrevocable, coming into…
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As another year-end approaches, tasks on your financial “to-do” list should include a reexamination of your current gifting, retirement, and estate planning and act on key year-end planning opportunities. A review of your current estate planning and current financial position can help you ensure that you are taking full advantage of all tax-saving opportunities and…
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Within wills or trust documents, a power of appointment grants an individual, known as the power holder or donee, the authority to designate another person, the appointee, as the recipient of all or a portion of assets. Powers of appointment can serve as powerful estate planning tools, offering significant tax planning opportunities. While we cannot…
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Estate planning encompasses a wide variety of subject matter, from how your assets may be titled and who is the beneficiary of your insurance to IRAs and 401(k)s, to the creation of business entities, the establishment of buy-sell agreements, the creation of trusts and gifting during your lifetime. The process allows you, rather than a…
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In my experience, it is often much more important to plan in anticipation of incapacity during your lifetime. For example, what would happen if one spouse becomes incapacitated, needing to go into a nursing home and the other spouse needs to sell the primary residence during that time? In North Carolina, if a person becomes…
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In Rev. Proc 2022-38, the IRS provided inflation adjustments for various IRS Code provisions for taxable year 2023, including many relevant to trusts, estates, and gifts. The 2023 inflation adjustments include: The basic estate and gift tax exclusion amount (and the generation skipping transfer tax amount) will increase to $12,920,000 from the 2002 exemption of…
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Towards the end of the year, some families consider making financial gifts to others as part of their year-end tax planning. As part of your estate plan, you may consider sharing your financial success with your children, grandchildren, or other loved ones before your death. First, let’s review gifts that aren’t taxable. Gifts that are…
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