Newport Beach Estate Planning Attorney Shares Gifting Strategies for 2012

9:03 pm Asset Protection, Estate Planning

money gift 2 e1316545217983 Newport Beach Estate Planning Attorney Shares Gifting Strategies for 2012A WSJ.com post today detailed the ways that some wealthy Americans are using the current generous gift and estate tax exemptions to help avoid future estate taxes:

Family loan forgiveness – Wealthy families that used all of the former $1 million gift exemption and turned to family loans to transfer assets may wish to consider forgiving the loan.  However, it is important to follow certain formalities in doing so, in case the IRS comes calling with a gift tax bill in hand.  Your estate planning attorney can help with this.

Striking a balance – Many families used the $13,000 a year exemption to give money to grandchildren – but sometimes a span in ages can create an overall gift gap of several hundred thousand dollars.  Families wishing to equalize things among grandchildren by closing this gap can include language in a will or trust to do so, which can help avoid conflicts later on.

Business valuation discounts – You can move at least part of a family business out of your estate by taking advantage of the current gift-tax exemption and valuation discounts for minority stakes in a business.  Valuation discounts may be disappearing soon, so taking advantage of this in 2012 could be advantageous to your estate.

Set up a SLAT – Spousal limited access trusts (SLATs) are used by those who want to save on taxes but may be worried about giving too much away.  A SLAT can remove assets from a husband or wife’s estate while taking advantage of the full gift-tax exemption, and if fortunes change after the trust is funded, the trustee can still make distributions to the surviving spouse.

Let our Costa Mesa law offices help you get started by contacting us today.

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