LIFETIME GIFT TO CHILDREN, GRANDCHILDREN AND TRUST ADMINISTRATION
Planning for the future can sometimes seem like a daunting task. One thought that crosses many people's minds is, "how will I take care of loved ones once I am gone?" Trusts can help to ease some of that worry and stress by beginning discussions and making plans for trust administration. The way assets are transferred or managed can have a huge impact on the financial benefit for loved ones.
Trusts can be initiated and even fully operational when a person is still of sound mind and body. Distributing assets can be set up for current situations or future situations that may arise after the main owner of assets passes away. One way to reduce future federal estate taxes is to properly manage lifetime gifts to children and grandchildren.
These gifts can be made annually up to amounts of $15,000 per person without incurring a gift tax. It is important to both heed the limitations of the gift tax but also to incorporate the gifts of a spouse which can double the gifting amounts per couple. If an estate in managed through a trust, one could manage some of the taxable estate by breaking off portions of assets to be gifted annually. This could add up to a significant savings over many years of proper trust administration.
This is just one of the ways that a trust could be better prepared to avoid estate taxes. Florida state may also have certain tax obligations in addition to federal tax if a trust or estate is not handled appropriately. If a trust wasn't managed properly, it could incur extra taxes by committing financial behaviors that are then charged to the trust, or the beneficiaries of that trust. It is recommended to have a trust set up prior to a person's inability to manage it.
Empower yourself with the guidance and expertise of the “Legal Eagles” Team. Whether you are facing a legal challenge, seeking advice, or striving to be sure your estate is smooth for your heirs, our dedicated lawyer is here to support you every step of the way. Please do not navigate the complexities of the legal system alone. Call us now at 863-294-1114 to schedule a consultation; we can provide you with the assistance and representation you deserve. Take action today and let the Legal Eagles Team at Rignanese & Associates help you.
On behalf of Kelly Kennedy of J. Kelly Kennedy, Attorney/CPA, P.L.L.C; J. Kelly Kennedy, Attorney/CPA, P.L.L.C. has merged with Rignanese & Associates, PLLC.
Source: estate.findlaw.com, "10 ways to reduce estate taxes," Accessed June 26, 2017.