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Charleston High Net-Worth Estate Planning Attorney

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Although the Tax Cuts and Jobs Act of 2017 temporarily doubles the annual exemption amount for estate, gift and generation-skipping taxes from 2018 through 2025, the estates of certain high net-worth individuals may still be subject to taxes without proper planning. By working with the right estate planning attorneys, you can take advantage of different strategies to minimize your estate tax liabilities and protect your assets.

Located in Mount Pleasant, Wiles Law Firm serves high net-worth individuals, families and business owners throughout South Carolina. Well-versed in the applicable wills, trusts and estate laws, we are dedicated to providing our clients with invaluable advice and guidance on wealth preservation techniques. By working with our legal team, you can plan your estate with confidence, knowing that your legacy and loved ones will be protected.

How Can High Net-Worth Individuals Minimize Their Estate Tax Liabilities? 

Despite the fact that fewer estates will be subject to estate taxes for several years, there are still viable approaches to minimizing estate tax liabilities. These include:

  • Tax-Free Annual Gifting -- The annual gift tax exclusion has been elevated to $15,000 for individuals ($30,000 for married couples). This means that you can make annual gifts of this amount to as many individuals as you like each year, up to the exclusion amount, without tax consequences. In doing so, beneficiaries can be provided with a portion of their inheritance each year while you are living. This approach will also reduce the ultimate value of your taxable estate. 
  • Charitable Trusts -- Such trusts combine annual gifting with charitable donations to reduce both income and estate taxes. In a charitable remainder trust, for example, property is transferred into a trust that names a charity as the final beneficiary. After a designated individual receives income for a specified period of time, the remainder is provided to the named charity. Organizations that can be named as beneficiaries in a charitable trust include universities, medical centers, and nonprofit organizations. Finally, another way to create a charitable legacy is by establishing a foundation.
  • Qualified Personal Residence Trusts -- Because a home is often a large component of any estate, one way of reducing the estate’s value and minimizing taxes is to create a qualified personal residence trust (QPRT). In this arrangement, title to the home is transferred into the QPRT for the benefit of family members, while you retain the right to reside in the dwelling for a specified period of time. The property and any appreciated value since the transfer subsequently passes to the beneficiaries without additional estate or gift tax consequences. If you die before the specified time period ends, then the full value of the house is included in your estate for tax purposes.
  • Grantor Retained Annuity Trust (GRAT)/Grantor Retained Unitrust (GRUT) -- These estate planning tools allow you to transfer income-producing assets (e.g. a closely-held business, stocks), into a trust for a predetermined number of years. During that time, the trust pays you income. The income in a GRAT is a fixed dollar amount that is not adjusted annually, while the income in a GRUT is a percentage of the trust assets’ value which can fluctuate each year. At the end of the term, the trust assets and appreciated value are transferred to the beneficiaries, reducing the estate’s value. If you die before the term ends, then a portion or all of the assets may be included in your taxable estate.
  • Irrevocable Life Insurance Trusts -- Although life insurance proceeds pass outside of your estate, the cash value of the policy is included in the estate’s taxable value, which means that beneficiaries could lose a significant portion of the insurance proceeds to taxes. By creating an Irrevocable Life Insurance Trust (ILIT) to hold the policy, the proceeds can be excluded from the taxable estate. The trust acts as both policy owner and beneficiary, and the proceeds can be used to pay estate taxes, debts and final expenses as well as to provide income to a surviving spouse or children.
  • Generation Skipping Trusts (GSTs) -- Also referred to as dynasty trusts, these vehicles allow you to “skip” a generation in your estate (your surviving spouse and children) and pass assets directly to grandchildren, great-grandchildren, or other descendants, all of whom are referred to as “skip persons.” While a GST is subject to tax liabilities, a properly structured trust can take advantage of the current exclusion amount, while allocating future appreciation of trust assets directly to the beneficiaries.

It is worth noting that the present exemption amounts will sunset in 2026 and revert back to pre-2018 levels. This creates potential issues for high net-worth planners with gifting programs who want to take advantage of the higher exemptions. These considerations make having the  guidance of experienced estate planning attorneys essential.

The Informed Choice in High Net-Worth Estate Planning

At the Wiles Law Firm, we provide all of our clients with innovative legal solutions and superior personal service. Our trusted advice and objective insights will hold you in good stead as you plan your estate, manage your gifting programs, minimize your tax liabilities, and provide for your loved ones. By partnering with your financial advisors and accountants, we will work to preserve your legacy for generations to come. Given the recent changes to the tax laws, we believe it it is essential for everyone to reconsider their estate plans. Please contact our office as soon as possible to set up a consultation.

Wiles Law Firm, LLC helps clients with their estate planning needs in Charleston, South Carolina and the surrounding areas such as West Ashley, Summerville, North Charleston, Mount Pleasant, and John's Island.

Information on this website is not legal advice. Further, viewing of the enclosed information does not create an attorney-client relationship with Wiles Law Firm, LLC. Matters will be handled by attorneys who primarily practice out of our office in Charleston County located at 852 Lowcountry Blvd., Ste. 101, Mt. Pleasant, SC 29464. M. Emerson Wiles, III is the attorney responsible for this advertisement.

Any result Wiles Law Firm, LLC may achieve on behalf of one client in one particular matter does not necessarily indicate similar results can be obtained for other clients. Please contact a South Carolina estate planning attorney or one of our attorneys with Wiles Law Firm, LLC for a consultation regarding your unique estate plan.

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852 Lowcountry Blvd., Suite 101, Mount Pleasant, SC 29464
| Phone: 843-718-0232

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