Weinstein & Randisi
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What is the new normal for estate planning and trusts?

Estate planning has certainly come a long way over the last 20 years. You can minimize the complexity now for trying to avoid federal estate taxes and it is much simpler because of how it evolved. Some of it can still be a bit complicated, so focusing on that will be of utmost importance to you and your attorney.

In 1995, you had to pay 55 percent of your estate to federal taxes. The exemption was $600,000 and, even though a couple could double that exemption to $1.2 million, trusts were one way to get around federal taxes. They were pretty inflexible but worth it to avoid the hefty 55 percent tax. Not only that, but the revocable living trust came into being.

Now, the federal estate tax exemption is up to $5.43 million and increases every year for inflation. Also, the federal tax decreased from 55 percent to 40 percent. Even better, married couples can pass on twice the threshold to a whopping $10.68 million. Probate can be avoided by putting payable-on-death on bank accounts and transfer-on-death on investment accounts.

There is a "new normal" that minimizes income taxes and maintains flexibility. It is estimate that 99.8 percent of Americans will have no federal estate taxes to pay. This is because the traditional Marital/Family Trust plan is no longer needed because of the new methods that are now in place.

Now, instead of trying to exclude assets and property from the taxable estate, the new trend is that couples with less than $10 million plan for "estate inclusions." This means that the estate can have a lot more assets as long as the estate is clearly left to individuals who are of your bloodline.

These and other issues can be discussed with an attorney who has experience in this area. It can be confusing, but with the right guidance, you can save your estate from taxes.

Source: WealthManagement.com, "What's Hot in Estate Planning Right Now May Surprise You," Sep. 01, 2015

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Weinstein & Randisi
290 Linden Oaks, Ste. 200
Rochester, NY 14625

Toll Free: 800-768-1780
Phone: 585-310-1578
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