Gifting Strategies: Leveraging Your Client’s Gift Tax Exemption Now and Planning for 2026 (and Beyond)

Recording of a 110-minute CPE webinar with Q&A


Conducted on Wednesday, November 6, 2019

Recorded event now available

or call 1-800-926-7926
Program Materials

With the federal gift tax exemption at an all-time high of $11.4 million, now is the time to give clients valuable advice about how to leverage their heightened gift tax exemption. This webinar will take a fresh look at gifting strategies that will help clients maximize use of their gift tax exemption in the current estate planning environment. Gifting during life (instead of at death) often results in more effective estate planning. Our expert panelists will provide an overview of gifting methods (including using the annual exclusion, gift-splitting, net and net-net gifts, gifting-up, gifting a deceased spouse's unused exemption), and discuss the impact of recent tax reform and planning for 2026 (which is when the gift tax exemption may fall back to $5 million).

Description

For high net worth individuals, gifting is a critical piece of an estate planning strategy. Lifetime gifting removes future appreciation from an estate, provides protection from creditors, and allows the taxpayer to transfer assets to desired beneficiaries. The trade-offs between gifting and achieving a step-up in basis at death will also be contemplated, including how to accomplish both.

Taxpayers were concerned about the effects of dying post-2025 when the exclusion is slated to return to the $5 million exemption after making currently non-taxable gifts exceeding this amount. Gratefully, proposed Regulation Section 20.2010-1(c) in the "clawback regs" allows the greater of the two exemptions at death. At the same time, not explicitly addressed is portability. How does this impact the second spouse to die?

Listen as our expert panel explains how gifting has been affected by tax reform, various gifting strategies, when to implement each, and the risks and rewards of each option. There are numerous gifting strategies for clients to consider (such as GRATs, net gifts, and planning with grantor trusts). Significant tax savings may be achieved when these strategies are implemented at the proper time in the right situation.

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Outline

  1. Tax reform overview (where the gift tax exemption has been, where we are now, and where it’s going in 2026)
  2. To gift or not to gift: Trade-offs between gifting versus achieving step-up in basis
  3. Clawback regulations
  4. Annual exclusion and gift-splitting (including 529s and 2642(c) trusts)
  5. Net and net-net gifts
  6. How to structure and maximize use of GRATs
  7. Gifting-up and other transfers (including gifting to parents to use their gift tax exemptions and pitfalls of general powers of appointment to parents).
  8. Gifts to lifetime QTIP trusts
  9. Planning with grantor trusts

Benefits

The panel will review these and other essential issues:

  • Recognizing clients who will benefit from gifting strategies
  • Effect of tax reform and the 2026 sunset on gifts
  • Clawback regulations
  • Implementing GRAT strategies
  • Benefits of net and net-net gifting
  • Tried and true gift strategies

Faculty

Curatolo, Kristen
Kristen A. Curatolo

Partner
Kirkland & Ellis

Ms. Curatolo focuses her practice on wealth transfer planning, business succession planning, and charitable giving. She...  |  Read More

Handler, David
David A. Handler, P.C.

Partner
Kirkland & Ellis

Mr. Handler concentrates his practice on trust and estate planning and administration, representing owners of closely...  |  Read More

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