Estate Tax Planning

Introduction

Estate taxes can erode up to 40% of your wealth, but proactive planning ensures your assets pass smoothly to heirs. This guide covers 2024 exemption limits ($13.61 million per individual), IRS rules, and strategies to shield your legacy from unnecessary taxes.

Key Strategies

1. Leverage Annual Gift Exclusions:

   • Gift up to $18,000 (2024) per recipient tax-free annually.

   • Use Crummey Trusts for minors to retain control.

2. Irrevocable Life Insurance Trusts (ILITs):

   • Remove life insurance proceeds from your taxable estate.

   • Avoid 3-year “look-back” rule by funding early.

3. Charitable Remainder Trusts (CRTs):

   • Donate assets, receive income for life, and reduce estate taxes.

4. Portability Election:

   • File Form 706 to transfer a deceased spouse’s unused exemption.