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Berdon Estate Planning Strategies - Ensuring that Your Wishes Are Followed

04.25.2017 | Client Alert

Estate planning is more than just about saving on taxes; it's about planning to ensure that your wishes are followed when you are gone. The Berdon Estate Planning Guide (the Guide) can help you achieve both goals.  Whether you are just beginning to think about your estate plan or need a resource of ideas to improve an existing plan, the Guide is your resource. 

Updated as tax laws change, the Guide offers insights and strategies to help reduce the impact of taxation, ensure that your loved ones are provided for, and pass on the maximum amounts to your heirs in the most tax-effective way. You'll find valuable information on estate taxes, gifting, charitable giving, life insurance, and other key areas.

The Guide is available in electronic form or in hardcopy via direct mail. To request a hard copy please click here.

The following highlights some of the important estate planning tips you will pick up in the pages of the Guide: 

Titling Assets Correctly: When you create a trust, make sure you direct your attorney to change the title of all assets you want managed by the trust's provisions. Otherwise, those assets may unexpectedly be included in your probate estate.

Weighing a Professional vs. an Individual Executor: The professional will be impartial and independent and typically has greater financial expertise that a nonprofessional.  An individual or personal representative is usually more familiar with family circumstances and is probably going to have lower administrative fees. You need to make a value judgment.

Using Credit Shelter Trusts to Achieve Your Goals:  For those who have such a trust, it's important to review plan documents to determine that they allow your estate to take full advantage of the 2017 exemption amount and future indexing of exemptions.

Considering the Value of Second-To-Die Life Insurance: This is a valuable tool for providing liquidity to pay estate taxes. This type of policy pays off when the surviving spouse dies - at a time when significant estate taxes may be due. 

Leveraging the ILIT Advantage:  A properly structured irrevocable life insurance trusts (ILIT) could save you estate taxes on insurance proceeds. A $5 million life insurance policy owned by an ILIT instead of you could reduce your estate taxes by as much as $2 million if the entire amount is subject to estate tax and the rate is still 40%.  

Employing Family Limited Partnerships (FLPs):  Properly structured FLPs allow you to increase the amount of gifts without increasing the gift tax cost.

Protecting Your Interests With a Buy-Sell Agreement:  Three key benefits.  (1) Buy-Sell agreements provide a ready market for the shares should the owner's estate wish to sell the stock; (2) These agreements set a price for the shares and may also fix the value for estate tax purposes; (3) They provide for stable business continuity by avoiding disagreements caused by unwanted new shareholders. 

These are only a few of the valuable tips found in the Berdon Estate Planning Guide.

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If you have questions, contact your Berdon advisor or Scott Ditman, CPA/PFS.

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