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Estate Planning

Strategies for your Estate

estateplanningProper financial and estate planning not only reduces estate taxes, it also ensures your wishes will be carried out after you’re gone. You can transfer wealth to your family now and generate tax and income benefits for yourself and others, while supporting the causes you care about.
There is, of course a chance that your estate won’t owe taxes, but it pays to check it out. All property left to a spouse is tax exempt, as long as he or she is a citizen of the United States. It would be wise to consult with an Estate Planner or Estate Attorney.

Remember, federal estate taxes are due upon the distribution of assets. If there aren’t enough liquid assets to pay the taxes, your family might be forced to liquidate assets at a disadvantageous time.

With careful planning, there are ways to avoid estate taxes, primarily through “gifting”, both now and later. A few strategies to consider:

  • Tax-free gifts of up to $13,000 per recipient annually can reduce the size of your estate and the eventual estate taxes owed.
  • Gifts to qualified charities during your lifetime, also called planned giving, give you an income-tax deduction, and through a bequest, reduce the size of your taxable estate.
  • Pooled Income Funds provide the tax-saving benefits of a charitable trust while allowing you to retain income for life and minimize investment risk.
  • An AB Trust allows couples to reduce or avoid estate taxes. Putting property in this trust allows access and use by the surviving spouse, while keeping the taxable estate half the size it would be if the property were left directly to the spouse.

Other items to consider when putting together your estate: Proper titling on all Real Estate, both primary residence and investment property, Durable Power of Attorney’s for Financial Matters, Advance Health Care Directives, a Will and property executed Trust.

Information courtesy of San Diego Eldercare Directory 2013

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