Estate planning can be a complex and confusing process. Some of the most common questions people have when beginning this process are related to taxes, and their impact on estate value. Let's face it, for someone that has been paying taxes their whole life, the last thing you want is for your estate value to be reduced because of taxes that could have been avoided.
One way to save on estate tax is to exercise your right to give gifts. According to tax code, estates can gift up to $13,000 per year, per spouse. These gifted amounts can be excluded from estate tax for a savings of $26,000 of otherwise taxable money. In an estate, assets are usually distributed among family members or organizations. By giving gifts, you can avoid that hefty estate tax and make a memorable donation to an individual, organization or cause of your choosing.
Just like when you are planning your will, trust or end of life wishes, you may benefit from speaking to a skilled estate planning attorney. If your estate is complex or of high value, an attorney can help draft your plan and answer any questions you may have. They may also be able to identify key aspects of your estate that you may have overlooked.
With the help of an attorney, tax specialist or financial planner, you can develop a strategic estate plan and avoid unnecessary estate taxes. Giving gifts is one way to see that your assets avoid being taxed, and make it into the hands of your loved ones.