Estate Planning and Tax Considerations By Robert L. Froerer on April 16, 2023

model house sitting on top of moneyEstate planning allows individuals to arrange for the management of their wealth in the event of their incapacity or death. Estate planning helps loved ones avoid the types of conflicts that can arise when someone dies without a will, trust, or estate plan in place.

There are many important factors to consider when creating an estate plan, including tax ramifications. The gifting that an individual does throughout their life and after death affects many taxpayers, including the decedent, their spouse, and other beneficiaries. Attorneys at Froerer & Miles go over estate planning tax considerations with their OgdenUT, and Layton, UT, clients and assist them in creating an estate plan that is financially beneficial to all involved parties.

Federal Estate Taxation

The federal estate tax is enacted upon the transfer of property at the time of a person’s death. An estate’s taxable amount varies based on the value of the property at the date of death. An estate value is calculated by taking the value of all the decedent’s owned property minus allowed costs, deductions, losses, and exclusions. 

Federal estate tax laws are complex and change regularly. Depending on the tax laws in place when a person dies, and the property’s final value, beneficiaries of the estate can expect to be taxed at a rate of between 18 and 40 percent. Higher tax rates apply for estates with higher values.

Can Estate Planning Minimize Tax Obligations?

Estate planning is the most effective way to minimize tax obligations for beneficiaries at the time of wealth distribution. Estate planning potentially reduces estate tax liability by utilizing planning techniques and wealth management strategies that reduce the amount of property in the taxable estate or lower the value of the property in the taxable estate.

Tax Considerations

Estate planning lawyers at our Ogden law firm help clients protect their assets and save their families time, money, and emotional distress related to asset distribution following their death. We listen to each client’s financial goals and recommend the best way to manage assets so that tax obligations are limited. 

Effective estate planning strategies depend on the size and value of the estate as well as the intended wealth distribution. Some estate planning strategies that can be effective in minimizing an estate’s tax obligations or preparing descendants for covering tax liabilities include:

  • Transferring a principal residence or vacation home out of your estate before death
  • Planning accordingly for the transfer of any S corporation ownership
  • Determining the best time to transfer interest in a partnership
  • Creating a charitable trust or giving to a charitable organization
  • Setting up an irrevocable grantor trust
  • Purchasing a life insurance policy that is held in a trust outside of the estate

Contact Froerer & Miles

Estate planning gives you control over how your assets will be distributed after your death and makes it possible to minimize tax obligations so that your family holds on to the wealth you have built. To learn more about the estate planning services offered by the attorneys at Froerer & Miles, contact our law firm online or call (801) 621-2690 and schedule a free consultation.

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Froerer & Miles

The attorneys at Froerer & Miles have successfully represented clients in a wide range of practice areas since 1959. Our team of attorneys can protect your best interests in matters related to:

  • Family Law
  • Estate law
  • Real Estate Disputes
  • Business Law
  • Personal Injury
  • Litigation

We offer free consultations and provide honest feedback to potential clients regarding their cases. To request your free consultation, contact us online or call us at (801) 621-2690.

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