NEWSLETTER

If you are like most people and wish to avoid as many taxes as possible, leaving more money to a surviving spouse or beneficiaries upon your death, then this article is for you.

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Under the Tax Cuts and Jobs Act (TCJA) the Federal Estate Tax has not been a concern for most households since the Act raised the exemption amounts to unusually high levels for pertinence.  However, the TCJA is set to expire at the end of 2025, drastically reducing the federal threshold for federal estate tax applicability making it a potential concern for many more households after 2025.

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In addition, if you are a Washington State resident or own Washington State assets and pass away, your assets may be subject to an estate tax prior to being transferred to heirs.  An estate tax should not be confused with an “inheritance tax” which some states apply to money after transferred to heirs.

 

Some strategies that should be considered in estate tax minimization include:

• Trusts: may be a tool that helps maximize any estate tax exemptions while taking care of surviving spouses and beneficiaries (heirs).

• Gifting to qualified charities using one of several planning mechanisms such as Donor Advised Funds

• Gifting assets to heirs before death; there are many misconceptions about gift taxes and in most cases, they do not apply

• Spending: for long term care or other needs to draw estate below estate threshold

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To learn more about estate planning options and better understand your own estate planning needs and taxes contact your Griffiths, Dreher & Evans, PS, CPAs advisor.