Planning for Reduction of Estate Tax Exemptions: Strategies for Clients Who Do Not or Soon Will Not Have Exemptions

Gift Tax Effective Rates vs. Estate Tax Effective Rates, Net, Net Gifts, GRATs, IDGTs, and Other Strategies

Note: CPE credit is not offered on this program

A live 90-minute CLE webinar with interactive Q&A


Thursday, November 12, 2020

1:00pm-2:30pm EST, 10:00am-11:30am PST

Early Registration Discount Deadline, Friday, October 16, 2020

or call 1-800-926-7926

This CLE webinar will provide guidance to trusts and estates attorneys on planning strategies in light of the possible fall in the estate tax exemption. The panel will discuss key considerations for clients who do not or soon will not have available exemptions, gift tax effective rates vs. estate tax effective rates, the net, net gifts, use of GRATs and IDGTs, and other key items.

Description

Under current tax law, individuals can leave their heirs up to $11.58 million without federal estate tax liability. However, the exemption is scheduled to decrease, and legislation could accelerate the decrease in exemptions. Even if the increased exemptions are ultimately extended, many clients will use large portions of their exemptions in anticipation of a change, leaving them with little or no remaining exemption going forward. Counsel must carefully craft planning for those above the exemption threshold amount in light of the potential reduction in estate tax exemptions.

Many planning strategies may become more or less effective without the availability of gift and/or GST exemptions to protect gifts from tax. By understanding the implications of a planning environment where clients have little or no available exemption remaining, advisors will be better prepared to guide clients through changes in the wealth transfer tax laws.

Trusts and estates counsel must revisit clients' estate plans to ensure the implementation of strategies to achieve their goals. Advisers can accomplish this by a variety of methods, such as giving annually, using the unlimited marital deduction, charitable or bequests, and other options. The goal is to reduce the value of the estate to minimize or avoid estate taxes. However, lifetime gifts incur a lower effective tax rate than transfers at death, and thus are more tax efficient than transfers at death.

Many estate planning strategies for high net worth clients seek further tax savings by reducing the amount of the gift for tax purposes. One such strategy that may be useful for older clients is the "net, net gift." In addition, the use of GRATs, IDGTs, or other trusts can be valuable tools that may produce substantial estate tax savings.

Listen as our panel discusses key considerations for clients who do not or soon will not have available exemptions, implications of "net, net gifts," and effective use of the GRATs IDGTs, and other strategies to achieve tax savings amid anticipated changes in tax laws.

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Outline

  1. Estate tax considerations for planners
  2. Planning now for a reduction in estate and GST tax exemptions
  3. Impact of a potential reduction in estate tax exemptions
    1. Planning for those without available exemptions
    2. Gift vs. estate tax effective rates
    3. Net, net gifts
    4. Defined-value gifts and sales
    5. GRATs and IDGTs
  4. Planning tips and best practices for trusts and estates counsel

Benefits

The panel will review these and other key issues:

  • What are the key planning considerations in light of a potential reduction in estate tax exemptions?
  • What gifting strategies are available to limit or minimize gift and estate taxes, before and after a reduction in tax exemptions?
  • What are the benefits and challenges of using defined-value transfers in an environment of changing tax laws?
  • How does a reduction in exemptions impact common estate planning strategies, such as Crummey trusts, GRATs, and IDGTs?
  • How can net, net gifts be used as a planning tool?

Faculty

Willis, Tyson
Tyson D. Willis

Attorney
Arnall Golden Gregory

Mr. Willis focuses his practice on crafting and implementing successful wealth transfer planning strategies, including...  |  Read More

Additional faculty
to be announced.

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