Advanced Level Planning

“Flexible” Irrevocable Trust (also known as a Life Insurance Trust or Gifting Trust)

The Wealth Replacement Trust is an excellent vehicle for passing significant amounts to your beneficiaries, while avoiding Estate Taxes for several generations. Additionally, this Trust, when funded by life insurance, may provide tax-free funds which can be used to: create a “Family Bank” which your loved ones can turn to for help when needed or to invest and build your family’s wealth for generations; defray some or all of the anticipated estate taxes on your other assets; provide funds to pay income taxes on IRA and annuity withdrawals; equalize gifts to various beneficiaries (such as when there are children of another marriage or real estate or a business is earmarked for a particular beneficiary). Our unique “flexibility” features permanent changes to be made to the Trust later, even though it is irrevocable. Plus, this Trust can provide significant asset protection for you and your beneficiaries, from spouses, divorces, lawsuits, creditors and bankruptcies.

Personal Residence Trust

A Qualified Personal Residence Trust (“QPRT”) provides a unique opportunity to remove your personal residence or vacation home from your taxable estate, while you continue to enjoy it during your lifetime. The QPRT has the potential to save your beneficiaries hundreds of thousands of dollars (or more) in Estate Taxes, while allowing you the continued use of the property. This trust may also protect your primary residence and/or vacation home against potential lawsuits and creditors.

Capital Gains Bypass Trust

The Capital Gains Bypass Trust, also known as a Charitable Remainder Trust, is an IRS approved method of avoiding the payment of Capital Gains Tax upon the sale of appreciated property such as real estate, stocks and mutual funds. After transferring the assets to the Bypass Trust and selling them, you receive a lifetime income payment. When properly combined with a Life Insurance Trust, your beneficiaries will also receive the full value of the trust assets, estate and income tax-free. Alternatively, your beneficiaries may continue to receive income payments for a period of years after you’re gone.

Other Gift Planning

It is important to seek qualified professional advice when making gifts so that they will withstand IRS scrutiny and not be currently gift taxed or pulled back into your taxable estate at your death. When making gifts of real property, care should also be taken to avoid a property tax reassessment. We can help you avoid these and other potential pitfalls while counseling you on proper gift giving procedures.

Reduction or Elimination of Estate Taxes for Very Large Estates

Once the above planning techniques have been used, if appropriate, even more advanced level estate planning may be designed and implemented by our “of counsel” attorneys for estates of over $10 million. These include, but are not limited to: specialized irrevocable trusts (such as “GRATs”, “IDGTs”, “CLATs”); private annuities; self-cancelling installment notes; and private foundations.

Income Tax Reduction for Large Estates

Through our “of-counsel” attorneys, we also provide specialized income tax planning if you have over $250,000 of annual taxable income.