Top 10 Estate and Legacy Planning Techniques
Revocable Living Trust: This arrangement helps you bypass probate while managing your assets throughout your lifetime and beyond.
Property Power of Attorney: A legal document that authorizes someone you choose to handle your financial affairs and property matters on your behalf.
Health Care Power of Attorney: This document lets you designate someone to make medical decisions for you if you’re unable to make them yourself.
Annual Gift Tax Exclusion: A method that allows you to give money or property to others each year without triggering gift or estate taxes, while preserving your lifetime tax exemption.
Irrevocable Life Insurance Trust: This trust structure keeps life insurance proceeds out of your taxable estate when you pass away.
Family Limited Partnership: A business structure that serves multiple purposes:
- Shields partnership assets from individual partners’ creditors
- Protects limited partners from liability
- Allows parents to transfer wealth to children while keeping control
- Potentially reduces the taxable value of transferred assets
Children’s or Grandchildren’s Irrevocable Education Trust: A trust arrangement that parents and grandparents can establish to fund educational expenses for younger generations.
Charitable Remainder Interest Trust: Through this trust, you can donate assets to charity while continuing to receive income from those assets. You’ll benefit from a tax deduction for your charitable contribution and sidestep capital gains taxes on the donated property.
Fractional Interest Gift: This strategy involves transferring portions of real estate to recipients, which can qualify for valuation discounts when calculating gift and estate taxes.
Private Foundation: Wealthy families often establish these organizations to support charitable causes while qualifying for tax deductions and maintaining influence over how the foundation’s resources are used.
