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  Some of the most effective estate planning strategies involve setting up irrevocable trusts. For a trust to be deemed irrevocable, you, the grantor, lose all incidents of ownership of the trust’s assets. In other words, you’re effectively removing those assets from your taxable estate. But what if you’re uncomfortable placing your assets beyond your control? What happens if your financial fortunes take a turn for the worse after you’ve...

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May 27, 2020

  There are several tools you can use to build flexibility into your estate plan. Flexibility is especially important now because of an uncertain estate planning environment. The federal gift and estate tax exemption currently is an inflation-adjusted $11.58 million (the highest it’s ever been) but it’s scheduled to drop to its pre-2018 level of $5 million (indexed for inflation) on January 1, 2026. This window of opportunity could close sooner, however,...

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May 20, 2020

  The novel coronavirus (COVID-19) pandemic has refocused people’s thoughts on the health and safety of their families. In addition to taking the necessary steps today to protect your loved ones, it’s equally important to consider their financial security in the future. If you don’t have a will, drafting one should be your first step in developing a comprehensive estate plan. Because of stay-at-home orders in many states, it may...

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May 15, 2020

  If you have outstanding loans to your children, grandchildren or other family members, consider forgiving those loans to take advantage of the current, record-high $11.58 million gift and estate tax exemption. Bear in mind that in 2026, the exemption amount will revert to $5 million ($10 million for married couples), indexed for inflation. Under the right circumstances, an intrafamily loan can be a powerful estate planning tool because it allows you to...

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May 07, 2020

  Many people’s estates typically include IRAs. Be aware that two major laws passed into law recently, the Setting Every Community Up for Retirement Enhancement (SECURE) Act and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, have had a direct effect on IRAs. In a nutshell, the CARES Act waives required minimum distribution (RMD) rules for IRAs (and certain defined contribution plans) for calendar year 2020. If you’re fortunate...

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April 23, 2020

You may have several different types of trusts in your estate plan. In general, to achieve the greatest tax savings, these trusts must be irrevocable, thus requiring you to give up control over the trust assets. Even though you appoint a trustee to oversee distribution of the trust’s assets, you can go a step further by appointing a trust protector. This person will serve as an overseer of the trustee’s...

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March 25, 2020

Longer life expectancies and rising health care costs make saving for retirement more important than ever before. A Health Savings Account (HSA) can be a powerful tool for financing health care expenses while supplementing your other retirement savings vehicles. And it offers estate planning benefits to boot. What’s an HSA? An HSA is a tax-advantaged savings account funded with pretax dollars. Funds can be withdrawn tax-free to pay for a...

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March 18, 2020

Payable-on-death (POD) accounts provide a quick, simple and inexpensive way to transfer assets outside of probate. They can be used for bank accounts, certificates of deposit or even brokerage accounts. Setting one up is as easy as providing the bank with a signed POD beneficiary designation form. When you die, your beneficiaries just need to present a certified copy of the death certificate and their identification to the bank, and...

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March 11, 2020

No one said estate planning is easy, and this is especially true if you have a “blended family.” The good news is that there are two trust types — a qualified terminable interest property (QTIP) trust and an irrevocable life insurance trust (ILIT) — that can provide for your children from a previous marriage while also taking care of your current spouse and any children from your current marriage. QTIP...

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March 04, 2020

Whether you’re moving to another country for work-related reasons, retirement or simply want an opportunity to experience a new culture, it’s important to understand the potential tax and estate planning implications. If you don’t, you could be hit with some unpleasant surprises. Here are three possible pitfalls: Double taxation. If you’re a citizen of the United States, U.S. taxes will apply even after you move to another country. So if...

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February 26, 2020