Articles Posted in Estate Planning-Wealth Planning

Philanthropic contributions not only serve the betterment of society, but they can also yield financial benefits in terms of reducing tax obligations. Charitable trusts in particular are invaluable when it comes to reducing your estate and minimizing estate taxes. In addition, they can provide other benefits during your lifetime.

CLTs and CRTs

First off, let’s take a look a the two types of charitable trusts you can create: charitable lead trusts (CLT) and charitable remainder trusts (CRT).

Out-of-state moves require a great deal of planning, but many people overlook one crucial aspect of the process—updating their estate plan. Different states have their own rules that may affect how a will is carried out, so it’s important to review your estate plan when you move.

Living Will

A living will sets forth your wishes regarding how you are to be cared for in the event you are rendered incapable of making your own decisions. Also known as an advance medical directive, this document is usually drafted in a way specific to the state in which you reside. Once you move, it’s possible that your current living will won’t be accepted.

Whether it’s something as simple as owning a home out of state or as dramatic as a difficult family situation, there are many factors you’ll need to consider when putting together your estate plan. Often, the vagaries of life will require you to revise your plans time and again, so even if you already have a will, trusts, and other important documents in place, you should see your attorney to make sure everything works out the way you want it to.

Here, we’ll go over a few of the ways your estate plan might get a little messy and what should be done about it.

Complex Assets

When you hear about trusts, you might think of them as merely existing for rich people who have way too much property for their own good. However, a trust can benefit you even if you don’t own millions in assets.

Main Benefits of a Trust

The main way that trusts benefit you is by transferring ownership of your property. This affords several benefits, including:

When creating an estate plan, most people think only of their will, but they are actually quite comprehensive. There are many things that can go wrong with an estate plan, whether it’s from a change in family situation for you or one of your beneficiaries, a sale or purchase that affects your assets, or some minor change in the law. Here, we’ll go over some of the most common pitfalls to avoid in putting together your estate plan.


Estate planning is not something you do only when you get old or when your life seems to be winding to a close. Some events cannot be planned for, and you may find yourself suddenly short on time. In addition, not every aspect of an estate plan has to do with your passing. A well-constructed plan will also include provisions for who can make decisions on your behalf if you become incapacitated, or detail who will get custody of any children still at home if you pass on. Having your plan together early will benefit you throughout your life, not just at its end.

Strategic business planning is key in running your organization, both in terms of staying afloat as a business and in managing risk, such as liability and regulatory compliance. It’s also a continual process-there are always changes in the market, your organization, and the law, so you’re never truly done planning.

It’s not a simple process, but there are a few things you can do to make it easier on you and the stakeholders within your business’s sphere of influence. Here, we’ll go over a few pointers for effective-and legal-strategic planning.

  • Involve your stakeholders: While executives and leaders are most often the ones with the overall vision for the company, you need to make sure those who will carry out your strategic business plan-any and all stakeholders-are involved in the planning process. Not only will this make certain they know the plan when it rolls out, but it can also inform the planning process in powerful ways.

Death is certain, and you want to make sure your spouse, children, and others dear to you are properly cared for when your time comes. The purpose of life insurance is to provide for your loved ones when you pass on, and it does this by paying out a lump sum to them upon your death.

Unfortunately, federal and state taxes can defeat the purpose of holding a life insurance policy. If it pays out more than a certain amount, heavy estate taxes will apply, and your legacy will be reduced to a shadow of what it once was. One way to keep this from happening is to place your policy in an irrevocable trust, known simply as an irrevocable life insurance trust, or ILIT.


Transferring your estate to your posterity after you pass on is not something the government wants to allow you to do for free. Heavy estate taxes are subtracted from your wealth when making these transfers, which is part of the purpose for using trusts. Normally, these will transfer property to your children, but not all trusts work that way. One type of trust, called a generation skipping trust, allows you to pass on your wealth while avoiding heavy estate taxes.

Why Skip a Generation?

A generation skipping trust, instead of passing wealth on to your children, passes it on to your grandchildren. This serves the purpose of avoiding estate taxes that can still come into play when you use a regular trust. For example, when the trust amount is paid out to your beneficiaries, they may have to pay taxes on the amount received. When they pass that wealth on to their children, the tax amount is paid again when their beneficiaries receive it.

Captive insurance companies are like other insurance providers, except with one major difference: you control the company. A captive is owned by those who are insured by it, and that provides valuable advantages to businesses and their owners. When properly structured, a captive insurance company will yield the following benefits to your business:

  • Fill in coverage gaps: The primary purpose of a captive insurance company is to provide insurance against risk to your business. Other insurance providers may have gaps in their coverage, or you may face scenarios that are otherwise uninsurable. A well-designed captive can protect you against these risks in addition to any coverage provided by outside sources.
  • Asset protection: Assuming the captive is formed for the above purpose (to insure you against risk), it can also provide the benefit of protecting assets used within it. Since a successful business is an attractive target for lawsuits, placing some of those assets within a separate entity—i.e. the captive—will keep it out of reach of creditors. The captive will likely have no liability when it comes to suits leveled against your business, so the assets placed within it will be safe.

When putting together an estate plan, there are many factors to take into consideration—where your assets and finances will go, who will have the responsibility to take care of you if you should become incapacitated, etc. If you own any pets, you may be concerned for their wellbeing as well. Making plans for your pets if you should pass on or become incapacitated is as much a matter of estate planning as anything else.

Care Options

You have a number of options when it comes to making provisions for your pets in your estate plan, but there is one point to remember: you cannot directly leave your pet money in your will. They are considered property in the eyes of the law, and your plans will have to be designed around that.

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