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Melanie Abigania and Jessica Simons

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Power Up Your Trust With Crummey Powers

Posted by Melanie Abigania and Jessica Simons on Apr 25, 2022 12:23:43 PM

The unified gift and estate tax exemption is set at an inflation-adjusted $12.06 million for 2022, up from $11.7 million for 2021. This means that for many families, estate tax liability isn’t a factor. However, for others, the annual gift tax exclusion continues to be an important estate planning strategy — especially since future tax law changes could lower the gift and estate tax exemption. For this reason, using a Crummey trust in your estate plan remains an important estate planning strategy. Here’s why.

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Topics: Tax, Estate Planning, High Net Worth

What Estate Planning Strategies Are Available For Non-U.S. Citizens?

Posted by Melanie Abigania and Jessica Simons on Apr 25, 2022 12:23:09 PM

Are you, or is your spouse, a non-U.S. citizen? If so, several traditional estate planning techniques won’t be available to you. However, if you’re a U.S. resident, but not a citizen, the IRS will treat you similarly to a U.S. citizen.

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Topics: Estate Planning

Careful Planning Required For Beneficiaries to Borrow From a Trust

Posted by Melanie Abigania and Jessica Simons on Apr 25, 2022 12:22:35 PM

Intrafamily loans allow you to provide financial assistance to loved ones — often at favorable terms — while potentially reducing gift and estate taxes. But what about families that lack the liquid assets to make such loans? Are there other options if they have a trust?

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Topics: Tax, Estate Planning

Clarity Counts When it Comes to Estate Planning Documents

Posted by Melanie Abigania and Jessica Simons on Mar 21, 2022 6:45:45 PM

Precise language is critical in wills, trusts and other estate planning documents. A lack of clarity may be an invitation to litigation. An example of this is the dispute that arose after Tom Petty’s death, between his widow and his two daughters from a previous marriage. (The two parties have since resolved their differences and dismissed all litigation matters.)

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Topics: Estate Planning

A Beneficiary Designation or Joint Title Can Override Your Will

Posted by Melanie Abigania and Jessica Simons on Mar 21, 2022 6:45:08 PM

Inattention to beneficiary designations and jointly titled assets can quickly unravel your estate plan. Suppose, for example, that your will provides for all of your property to be divided equally among your three children. But what if your IRA, which names the oldest child as beneficiary, accounts for half of the estate? In that case, the oldest child will inherit half of your estate plus a one-third share of the remaining assets — hardly equal.

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Owning Real Estate in More Than One State May Multiply Probate Costs

Posted by Melanie Abigania and Jessica Simons on Mar 21, 2022 6:42:07 PM

One goal of estate planning is to avoid or minimize probate. This is particularly important if you own real estate in more than one state. Why? Because each piece of real estate titled in your name must go through probate in the state where the property is located.

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Topics: Estate Planning

The Donor-Advised Fund: A Powerful Vehicle for Charitable Giving

Posted by Melanie Abigania and Jessica Simons on Feb 23, 2022 3:09:35 PM

If charitable giving is important to you, consider a donor-advised fund (DAF). A DAF — typically sponsored and managed by a community foundation or commercial investment company — offers many of the benefits of a private foundation at a fraction of the cost.

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Topics: Estate Planning

The 2021 Gift Tax Return Deadline is Almost Here, Too

Posted by Melanie Abigania and Jessica Simons on Feb 23, 2022 2:37:43 PM

April 18, 2022, is the deadline for filing your federal income tax return. Keep in mind that the gift tax return deadline is on the very same date. So, if you made large gifts to family members or heirs last year, it’s important to determine whether you’re required to file Form 709.

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Topics: Estate Planning

Does Your Trust Need Protection?

Posted by Melanie Abigania and Jessica Simons on Feb 22, 2022 4:31:22 PM

Designing an estate plan can be a delicate balancing act. On the one hand, you want to preserve as much wealth as possible for your family by protecting it from estate taxes and creditors’ claims. On the other hand, you want to have some control over your assets during your life.

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Topics: Estate Planning

With Proper Planning, a Charitable Remainder Trust Can Replicate a "Stretch" IRA

Posted by Melanie Abigania and Jessica Simons on Jan 24, 2022 12:47:21 PM

The “stretch” IRA generally no longer exists. But if you have a substantial balance in a traditional IRA, a properly designed charitable remainder trust (CRT) can allow you to replicate many of its benefits.

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