Estate Planning for Large Estates

Estate planning for large estates is complex and may require multiple strategies. In this article, we will briefly review several avenues that are available for estate planning for large estates.

Charitable Donations and Wealth Preservation

There are several types of trusts that allow you to use charitable donations for tax benefits while simultaneously preserving wealth for your family.

Charitable Remainder Trust

A Charitable Remainder Trust allows you to set up current benefits to either yourself or another beneficiary. This can either be for a set period or a lifetime benefit. After the benefit period ends, the remainder of the funds go to charity. Those with large estates appreciate this trust because it allows them to take a tax deduction for the present value of the future funds that will be donated to charity. Additionally, assets you place into these trusts are removed from your taxable estate.

Charitable Lead Trust

A Charitable Lead Trust is the opposite of a Charitable Remainder Trust. During a set period income is paid to charity. After the period is complete, the remaining assets go to your beneficiaries. This trust will remove assets it holds from your estate and will protect them from estate tax.

Benefits Future Generations

For some estate planning with a large estate means providing for more than just their children. They also want to provide for potential grandchildren and great-grandchildren. One way to do this is with a Generation Skipping Trust. This trust allows you to provide for multiple generations. It also gives you a $1 million exemption from the 45% Generation-Skipping Transfer Tax.

Caring for Large Estates

Estate planning for large estates is complex. We have presented just a few potential strategies for helping preserve assets. There are many more available. A qualified estate planner can help you find which options are best for you.

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