fbpx
MENU

Beyond the A/B Trust: Advanced Estate Planning Techniques

I. IRREVOCABLE TRUSTS

Functions. An irrevocable trust can shift property value and income to:

  • Build an educational fund for a child;
  • Provide current income for an adult child;
  • Provide current income for an aged parent; or
  • Provide asset protection for others.
    • If the beneficiaries do not have immediate access to trust funds, those funds are unavailable to their creditors (until an actual distribution).

Example:  Parent, in a 45% tax bracket must earn approximately $1,900 (before tax) to transfer approximately $1,000 by gift.  By deflecting income into trust, the income tax liability could be considerably less than the $900 otherwise payable by Parent.  The donee could use his or her personal exemption and a lower tax bracket to enable substantial tax savings to accrue within the family unit, assuming the “kiddie tax” is not applicable.

To read this article in full, please click here to download a PDF copy.

RECENT ARTICLES

How To Factor In Taxes When Considering Special Needs Trusts / (ABLE) Accounts

Cameron L. Hess was recently interviewed by Financial Advisor Magazine on the topic of the financial vehicles used for supporting ...

Proposition 19 Brings Substantial Changes to California’s Property Tax Assessment Rules

On November 3, 2020, California voters approved Proposition 19 which brings substantial changes to California’s property tax assessment rules and ...

UPCOMING EVENTS

September 30, 2021 – Estate Planning for Farm and Ranch Owners

Belan Wagner and Robin Klomparens will be speaking at an upcoming Strafford live video webinar, "Estate Planning for Farm and ...
green and yellow boxes

CHOOSE A LEGAL PARTNER THAT'S COMMITTED TO YOUR SUCCESS.

To find out how we can help you through the complexities of today’s legal issues, call (916) 920-5286 or click below.