The proper utilization of estate planning techniques and strategies is the process of planning and arranging ones assets so that taxes and administration costs are minimized. Get in touch with the experts at estate planning Austin. In this process the goal is to pass as much as possible of the assets of the estate on to beneficiaries.
The usual parties who are involved in most cases, where the estate is large enough to generate substantial costs and taxes, are the estate attorney, the CPA, the bank trust officer and the life insurance professional.
Taxes will be assessed in larger estates, both at the Federal and at the state levels, in many states. Taxes, however can be reduced by proper gifting strategies, as in many cases gifts can be given where the taxes are less than the corresponding estate taxes would be.
The arrangement of trusts coupled with proper life insurance planning can create liquidity in the estate proper so that assets do not have to be sold in order to pay taxes and costs.
The chronic problem with many larger estates is that much of the asset component of the estate consists of real property and other assets that are not liquid, or are appreciating assets that are not capable of being readily, nor being desirous of being sold for cash.
This situation is where proper planning with a good will and trust setup, along with proper placement of life insurance can provide the needed liquidity to pay administration costs and taxes, without having to sell property.
Federal estate taxes must be paid in full within nine months of the death of an individual, and many state jurisdictions have time limits as well.
It is prudent to plan your estate in advance of your death, with periodic updates arranged as individual situations change along the way.