Proposed Restrictions on Estate Planning Tools Could Impact Your Family

9:27 pm Uncategorized

There are many estate planning techniques available to a family that wants to protect assets to pass on to the children or grandchildren; options that extend far beyond a simple will, and even beyond a basic living trust. Two of these effective but lesser-known techniques are the Grantor Retained Annuity Trust (GRAT) and the Family Limited Partnership (FLP). Although both of these are trusted and respected protection strategies among estate planning attorneys, the White House is hoping (if Congress agrees) to place restrictions on the extent to which the GRAT and FLP can protect an estate from being taxed.

The proposed restrictions seem relatively minor, but could have a significant financial impact, as this article in the Wall Street Journal explains, including a proposed “minimum term of 10 years for GRATs,” allowing assets to then convert back to the grantor’s estate and be subject to estate tax; and the proposed restriction to FLPs which “aims to limit the ability of wealthy families to use partnership structures to minimize the valuation of assets for estate-tax purposes.”

What does this mean for our readers?If you have assets that you expect to pass on to your heirs come in and see us right away.We can plan now to limit the impact these restrictions would have on your family and your assets if and when they are passed into law.

Contact us today for individualized planning strategies to meet your unique needs.

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