“With the current COVID-19 heightened concerns within our communities, meeting our clients’ legal needs and concerns will be a priority of our firm. We are here to serve you. Being sensitive to your best interests and our community responsibility, we will be offering telephone and video conferencing for our current and future clients, including any new and developing matters you may have.”

Legal Experience and Local Roots

Offering professional legal services to individuals and businesses since 1986.

‘Tis the season . . . to address estate-planning needs

On Behalf of | Nov 17, 2020 | Estate Planning |

The holiday season is upon us. Christmas shopping has already begun in many St. George households, with decorations and meal-planning to be launched soon. Before things get truly hectic, there is still time to consider year-end estate planning tools that can benefit you and your loved ones far beyond the holidays.

Three years ago, the federal estate, gift and generation-skipping transfer tax exemptions were doubled from $5 million to $10 million. Indexed for inflation, the increased exemptions are $11.58 million this year.

Sunset provision

The increased exemptions are scheduled to revert back to $5 million (indexed for inflation) in 2026, but a change in administrations might speed up that reversion. Some observers believe it’s possible that the exemptions could even be decreased.

That presents high net-worth individuals with a possible use-it-or-lose-it scenario. The calendar doesn’t have many more remaining days for those who are planning to make use of the exemptions.

An alternative approach

For high-asset married couples uncomfortable with giving significant sums to descendants, there’s another way to take advantage of the existing exemptions: create a spousal lifetime access trust that’s funded with a gift at the current exemption amount.

The other spouse can do virtually the same, however, it’s important to share a point made in a recent National Law Review article on these trusts: “It is critical that the trusts are not exactly identical in order to avoid application of the ‘reciprocal trust’ doctrine.”

Of course, there can be many other estate-planning issues that can be readily resolved before 2020 turns into 2021.