Business Exit Planning

Location Our Location

677 Ala Moana Blvd. Suite 720

phone (877) 695-2102

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We believe the results of Estate Planning should be as follows:

1. Giving WHAT you have, to WHOM you want, WHEN you want, and under your TERMS and CONDITIONS.

2. Eradicate exposure to DIVORCE, LAWSUIT, and TRANSFER TAXES on your wealth INDEFINITELY.

3. Provide you with a satisfactory stream of INCOME and CONTROL.

 

 

General knowledge about Estate Planning

*The federal government imposes taxes on gratuitous transfers of property made during lifetime (gifts) or at death (bequests/devises) that exceed certain exemption limits. Gift taxes are imposed on transfers during lifetime that exceed the exemption limits, and estate taxes are imposed on transfers at death that exceed the exemption limits. The generation-skipping transfer (GST) tax is imposed on transfers to grandchildren and more remote descendants that exceed the exemption limits so transferors cannot avoid transfer taxes on the next generation by "skipping" a generation. The GST tax is levied in addition to gift or estate taxes and is not a substitute for them.

The gift, estate, and GST tax exemptions were $5 million in 2011.  The exemptions are indexed for inflation, resulting in exemptions of $5.12 million for 2012, $5.25 million for 2013, $5.34 million for 2014, $5.43 million for 2015, and $5.45 million for 2016. An individual can transfer property with value up to the exemption amount either during lifetime or at death without paying any transfer tax.  In other words, any portion of the exemption used during lifetime reduces the amount of exemption available at death for estate tax purposes. For example, if you made a lifetime taxable gift of $2 million in 2013, your remaining exemption amount that could be used by your estate at your death would be $3.34 million ($5.34 million 2014 inflation adjusted exemption, less the $2 million lifetime gift). The GST exemption essentially allows the earmarking of transfers, made during lifetime or at death, that either skip a generation or are made in trust for multiple generations.  Certain gifts are not applied toward the exemption, such as “annual exclusion” gifts and direct payments to medical or education providers, and can be made completely tax-free.

Transfers between spouses and to certain trusts for spouses, made during lifetime or at death, may be made without the imposition of any tax.  These transfers also do not use any exemption. This is known as the “unlimited marital deduction.”

* Material above was provided by American Bar Association

Disclaimer

This site is provided as a public service by the ABA Section of Real Property, Trust and Estate Law. While the information on this site is about legal issues, it is not legal advice or legal representation. Because of the rapidly changing nature of the law and our reliance upon outside sources, we make no warranty or guarantee of the accuracy or reliability of information contained herein.