Southern Massachusetts Estate Tax Planning Attorney

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Estate Tax Planning Lawyer Helping Residents In New Bedford, Easton & Hyannis

Despite the fact that the Tax Cuts and Jobs Act of 2017 temporarily doubled the annual estate tax exemption through 2025, many high net-worth individuals and families still need to consider estate tax planning. The best decision you can make to protect your wealth from potential estate taxes is to consult an experienced estate planning attorney

At Surprenant & Beneksi, P.C., we provide comprehensive estate tax planning services to clients in Southern Massachusetts, Cape Cod and the Islands. Our legal team is well-versed in the applicable trust, estate, and tax laws and has a well-deserved reputation for providing our clients with innovative estate tax planning strategies. When you consult with us, you will have confidence knowing that your legacy will be preserved for future generations. 

How to Minimize Estate Tax Liabilities

While fewer estates will be subject to estate taxes for several years, a number of approaches to minimize estate tax liabilities are worth considering, such as:

  • Tax-Free Annual Gifting — The tax reform measure increased the annual gift tax exclusion to $15,000 for individuals and $30,000 for married couples. Therefore, you can continue to make annual gifts up to this amount each year to as many individuals as you like without estate tax consequences. This approach allows you to provide beneficiaries with a portion of the inheritance you intend for them while you are living and will also reduce the value of your taxable  estate. 
  • Charitable Trust — These trusts are designed to combine annual gifting with charitable donations and reduce both income and estate taxes. One type of charitable trust is known as a charitable remainder trust into which you can transfer property, designate individuals to receive income for a set period of time, and the “remainder” is provided to a charitable organization (e.g. university, medical center, nonprofit organization).
  • Qualified Personal Residence Trust — For many, a home is often a large estate asset.  One approach to reducing the estate’s value and minimizing estate tax consequences is to create a qualified personal residence trust (QPRT). In this arrangement, title to the home is transferred into the trust the benefit of family members, while you are permitted to continue living in the dwelling for a specified period of time. The property and any appreciated value since the transfer passes to the beneficiaries after you die, without additional estate tax consequences. If you die before the specified time period ends, however, the full value of the home will be included in your purposes of estate taxes.
  • Grantor Retained Annuity Trust (GRAT)/Grantor Retained Unitrust (GRUT) — These trusts are designed to transfer income-producing assets, such as a closely-held business or stocks into the trust for a predetermined number of years. During that time period, the trust pays you income, either a fixed dollar amount that is not adjusted annually (GRAT) or a percentage of the trust assets’ value which can vary each year (GRUT). When the term ends, the trust assets and appreciated value are transferred to the beneficiaries, which reduces the value of the taxable estate. If you die before the term ends, then a portion or all of the assets will be included in your taxable estate. 
  • Irrevocable Life Insurance Trust — Life insurance proceeds pass outside of your estate, however, the cash value of the policy is included in the estate’s taxable value. This means that the beneficiaries could lose a significant portion of the final insurance proceeds to taxes. An Irrevocable Life Insurance Trust (ILIT) is designed to take ownership of the policy, which excludes the proceeds from the taxable estate. Because the trust acts as both the policy owner and beneficiary, the proceeds can be used to pay estate taxes, debts, final expenses and also provide income to a surviving spouse or children.
  • Generation-Skipping Trusts (GSTs) — Also referred to as dynasty trusts, a GST allows you to “skip” a generation in your estate, your surviving spouse and children, and pass assets directly to grandchildren, great-grandchildren, and other descendants, (referred to as “skip persons”). A properly structured GST can utilize the current exclusion amount while allocating future appreciation of trust assets directly to the beneficiaries.

Because the present exemption amounts will sunset in 2026 and revert back to pre-2018 levels, there are potential tax consequences for high-net-worth planners who want to capitalize on the higher exemption amounts. 

Contact Our Southern Massachusetts Estate Tax Planning Attorney

At Surprenant & Beneski, P.C., we are here to help you plan your estate, minimize your estate tax liabilities, and preserve your legacy. Our estate planning attorneys will collaborate with your financial advisors and accountants to ensure that your wealth and your loved ones will be protected. Whether or not the present estate tax exemption amounts will be made permanent or other changes to the tax code are on the horizon is uncertain. In the meantime, it is still crucial for everyone to revisit their estate plans to avoid potential tax liabilities. Please contact our office as soon as possible to set up a consultation.