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21. |
Give
Today, Save on Taxes Today |
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You
can transfer up to $12,000 per person per year, completely free
of gift taxes. This $12,000 gift tax-free level is set by the
IRS and will increase every year to account for inflation.
Crummey
gifts also allow you to use your current $12,000 annual exclusion
when gifting to a trust, instead of a living person. Not only
can you reduce gift taxes by making a $12,000 donation, but such
gifts can reduce estate taxes by decreasing the size of your
estate.
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22. |
Use
Advanced Gifting Techniques |
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Using
the Generation Skipping Transfer Tax Exemption, you can save on
the potential equivalent of an 80% tax imposed on assets left to
grandchildren.
Examine
how to use advanced
estate planning strategies to accomplish this.
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23. |
Give,
Give, Give... and Save on Taxes |
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If
you're feeling philanthropic, consider establishing a Charitable
Remainder Trust (CRT).
By
gifting to a CRT instead of an individual, you may avoid capital
gains tax on highly appreciated assets held by the trust.
Because
you are leaving assets to your favorite charity, you may also receive
an income tax deduction. Chances are you'll also be recognized by
the charity for your gift, and increase your take-home income.
Being
philanthropic has never been more worthwhile.
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24. |
Continue
the Family Name |
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Carefully
prepared Family Limited Partnerships
can help you reduce your tax bill, while continuing your family
name.
Set
up similarly to a regular limited partnership, your estate is
split up into limited partner shares and general partner shares.
Instead of gifting $12,000 in cash annually to an heir, give
away limited partner shares from your new Partnership.
NOTE:
FLPs have been under increasing scrutiny by the Internal Revenue
Service, and must be prepared with the utmost of care. Do your homework,
and work with an experienced estate attorney who has tax expertise.
Through
an FLP, you may be able to leverage your gifting without giving
up control (since you can retain the General Partner shares for
yourself), and protect your estate assets from the creditors of
your beneficiaries.
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25. |
Begin
Your Own Dynasty |
|
Irrevocable
dynasty
trusts, structured properly by an experienced attorney, can
reduce estate taxes for up to three generations.
A
dynasty trust provides excellent hedges for your family against
creditors, lawsuits, and divorcing spouses of your children and
grandchildren. Plus, in many cases, dynasty trusts can be funded
without incurring any gift tax, using your current Unified Credit.
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Capital Gains |
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Mortgage and Equity |
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Education Tax Breaks |
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Gifting Options |
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Sheltering Rental Income |
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Using Your Unified Credit |
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Social Security |
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Tax-Free Munis |
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Estate Tax Reductions |
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Life Insurance |
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IRAs and 401k Plans |
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And much more |
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