Minimize Inheritance Taxes with LA Probate Law
Over the years you have been able to amass a sizeable estate. You worked hard for it and have been successful at what you did for a living. All of your loved ones have greatly enjoyed those benefits, too, and have come to expect to keep on living well even after you are gone. In other words, they are expecting an inheritance – a sizable one. You love them and want to help them to continue to enjoy it, too. You need to be aware, though, that if your estate goes into probate, then inheritance taxes may take a large chunk of it away. Through the services of LA Probate Law, you can learn of ways to be able to pass on a much larger portion of your estate, and bypass the many problems that may be encountered otherwise. There are many estate planning tools that are available that can be customized today to fit almost any need – but it must be done before you die.
Preserve Your Assets with Sound Estate Planning
Preserving your assets and property through effective estate planning devices is important to ensure that you pass on as much as possible to your heirs. If you have a business that you want to pass on, then the continuance of that business may depend on having efficient tools in place to protect it from creditors, and from heirs who may not appreciate the division of assets that you have selected. A trust may need to be created and a responsible guardian appointed in order to ensure the best use of money and property, in the case of possible irresponsibility on the part of an heir. In that case, instead of disowning the individual, money can be distributed to pay their bills for them, but not given as cash to that person. Accessing professional knowledge to protect your assets in the best possible way can be obtained through Scott Schomer at LA Probate Law, who specializes in estate planning.
Trusts Are an Excellent Tool for Asset Protection
Trusts are an excellent way to protect your assets from being consumed by estate taxes. There are many forms of trusts that can be created; in fact, one can be designed for just about any need you might have. There really is a lot of flexibility. They must be set up correctly or your assets under them will revert to the control of the estate – where they will be taxed heavily. Living trusts, for instance, allow you to keep a large degree of control over the assets under them, but it is this fact that means that those assets may not be protected from going back into the estate after you die. In order for many trusts to be effective, and set up right, you should talk to an attorney, such as one at LA Probate Law. When created, you need to ensure that money is available to maintain the family and property during the probate period. Estate taxes will need to be paid within nine months, and money will also be needed to pay the yearly real estate taxes. You certainly do not want the property to be seized just because the money is tied up in the estate.
Avoid Inheritance Taxes with Estate Planning Tools
Another thing that needs to be considered in estate planning is the amount of money your heirs will have to pay in the way of inheritance taxes. This amount can be quite large, depending on how much is being given in the way of assets. Various instruments, such as trusts, enable taxes to be avoided altogether. Another advantage is that the money in a trust is available almost immediately, which could provide a source of cash to do other pressing things like buy back stock in a business, or to close your business interests, or to finish real estate transactions. In the case of a business, taxes can also be reduced through the creation of a Limited Partnership. Specific rules do apply, however, and the IRS watches over them with a lot of scrutiny because they are often misused. One very important ingredient is that assets must be distributed from the General Partners (owners) to the Limited Partners, and it must be run like a business. LA Probate Law can help you decide whether or not this instrument would be good for you and your needs.
Giving Away Assets Also Helps Reduce Your Taxes
An estate can also be reduced by simply giving away money. This is excellent because it immediately benefits both the giver and recipient and there are no taxes involved – up to a limit. There are maximum amounts that can be given each year, and these amounts are established by the government. This amount may change from one year to the next. There are also limits as to how much you can give to individuals, which is currently $12,000, but a husband and wife can each give up to this amount to the same individual, and they can give that amount to many people each year if they choose. The money being given is deductible on the part of the donor and the recipient will not have to pay inheritance taxes either – except on any interest the money may receive. Careful records need to be kept when giving gifts, in case the IRS ever decides to look into the matter. LA Probate Law is ready to help you determine if giving, or creating trusts or Limited Partnerships will be the best way to pass on your assets and meet your overall financial objectives when passing on your estate to your heirs. Planning your estate so that you bypass inheritance taxes is a tricky matter that you do not want to leave to chance or perform haphazardly. Your loved ones can be given more of your assets if you establish a careful plan with all of your assets.
Minimize Inheritance Taxes with LA Probate Law
Latest posts by Scott Schomer, Estate Planning Attorney (see all)
- What are the Advantages and Disadvantages of a Living Trust? - January 15, 2019
- Why Avoid Probate? - January 10, 2019
- When Do I Need a Tax ID Number for a Trust? - January 9, 2019