….. PLANNING IS ESSENTIAL.   What is meant by ESTATE PLANNING? Estate Planning is having happen what you want to have happen, once you are gone.  In order to have happen what you want to have happen, employ the right STRATEGIES to accomplish your objective.  What works for one person, may not work so well for someone else.  Give some careful thought to your objectives, and the strategies that are right for you.  Likewise, carefully choose advisors and professionals that will work with you on your unique objectives.


One fundamental decision is whether to employ a will or a trust in your estate plan.  To explore this idea further click on the following link:  Trust or Will?


Should a Trust be right for you, there are many different kinds of Trusts.  To peruse kinds of Trusts and the objectives that can be accomplished by various kinds of trusts, click on the following link: Trust Varieties


There are a number of different strategies involving trusts that are widely employed by clients.  These include:

A.  The LIVING TRUST.  The use of a living trust is the most commonly employed Trust strategy.  The technical legal term for a living trust is a “revocable grantor trust.”  The “Living Trust” can be used to keep your Estate out of Probate and to speed and streamline your estate distribution.  However, there are also many trust types designed to save estate taxes (see below).

B.  PORTABILITY.  The most common type of trust designed to save estate taxes is to take advantage of portability provisions.   Credit shelter trusts have been around the longer than portability trusts.  Portability trusts allow clients to take advantage of the unified credits of both spouses, like credit shelter trusts, but don’t require that the assets to be allocated at the deceased spouse’s death.  On the other hand, if a portability format is selected then a Form 706 must be filed with the IRS at the first death.  So there are advantages and disadvantage of portability trusts versus credit shelter trusts.  To read further about portability:  Portability strategies

C.   CREDIT SHELTER TRUSTS.  While portability trusts were introduced a number of years ago as an alternative to credit shelter trusts, credit shelter trusts still remain viable.  With a credit shelter strategy, at the first death the surviving spouse must allocate the specific assets to use the credit shelter.  Unlike the portability trust, the credit shelter strategy may not require the filing of an IRS form 706 at the first death (this depends on asset levels however).   Furthermore,  recent changes in estate taxes have created a whole “new normal” for planning in this area.  Many clients are well advised to give consideration to not only estate taxes, but to consider all income tax planning considerations.    To consider Credit Shelter Trusts and the New Normal further, click on the following link: Credit Shelter/The New Normal

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