Marriage and trust

Brought to You

by - Geerdes & Associates

For the past decade, married couples have been benefiting from the exceptional lifetime exemption and various strategies for managing estate tax liability. From the estate planning side, this included tactics like discounting minority interests, creative enhanced trusts, and aggressive lifetime gifting to family members. Although tax regulations have become more restrictive over the past few years, many of these tactics are still viable strategies for minimizing your estate tax.

However, all married couples utilizing these strategies should remember some key points about estate tax. The first is that the unlimited marital deduction for assets merely defers the estate tax to the surviving spouse, which means directly putting your assets in your spouse’s name could result in higher taxes and an elimination of any unused lifetime exemption if the surviving spouse does not correctly prepare tax returns.

Secondly, transferring all of your assets to your spouse does not protect the assets from probate court. Once the surviving spouse passes away, the assets are still subject to scrutinization from the probate court, and your heirs will have to hire a probate attorney to attempt to reclaim their inheritancewhether you have a Will or not.

To properly protect your assets, a trust is essential - particularly if you have properties, as there is no such thing as an automatic right of survivorship for properties in Georgia. A trust, if prepared correctly, can protect everything from your retirement accounts to your life insurance policies from additional taxes. Be sure to contact an estate planning attorney to get their advice on how you can best protect what’s most important to you.