The new federal tax rules are great for wealthy people who are creating their estate plans. That's because, according to the new tax exemptions, you'll be able to pass your estate on to your loved ones federal estate tax-free as long as your estate isn't worth much over than $11 million.
However, it actually gets better. Estate planning lawyers in the "know" are saying that with aggressive estate planning tactics, a married couple could potentially combine their exemptions of $22 million.
The end result is a wealth transfer strategy that protects over $250 million within an irrevocable dynasty trust. From there, the wealth can continue growing without triggering estate taxes in order to benefit future generations of the family.
The reason these strategies are now available has a lot to do with the way the current administration has been dismantling Obama-era regulations meant to hinder the use of so-called dynasty trusts.
Due to the changes to trust and estate planning laws, however, families may want to review their old trusts and estate plans to ensure that they are taking advantage of all of the new estate planning opportunities. Not maintaining trusts or estate plans that are no longer relevant is also advisable in some cases.
When it comes to estate planning and New Jersey trust law, the rules are always shifting and changing around us. Therefore, the more you know about and understand new legal developments, the better you'll be able to protect your family's wealth for future generations by limiting tax consequences and ensuring that all of your heirs are fairly treated after you're gone.
Source: Forbes, "Trusts In The Age Of Trump: Time To Re-Engineer Your Estate Plan," Ashlea Ebeling, Feb. 13, 2018