Five Florida Tax Based Estate Planning Tips
You’ve worked hard to build wealth. When it comes to your estate planning, certain tax moves could really benefit your estate. The Tax Cuts and Jobs Act, signed into law on December 22, 2017 changed the game when it comes to tax planning. Some of these changes are temporary and some are permanent. The following includes five tax planning tips to help you build more wealth.
Exemptions from Gift and Estate Taxes Have Increased.
Starting January 1, 2019, the $11.18 lifetime tax exemption for Gifts and Estate Taxes increased to $11.4 million due to an adjustment for inflation. Because of this adjustment, individuals who already used their $11.18 million lifetime exemption now can gift an additional $220,000 in 2019 without having to pay a federal gift tax. It is generally advisable to gift assets that have a high tax cost basis to avoid or minimize income taxes on a subsequent sale by the donee. Be sure to speak with an estate planning expert to see which assets you can gift to take advantage of the new higher limit.
Gift Up to $15,000 Per Recipient Tax-Free
In 2019, married couples can gift up to $30,000 tax-free per recipient. Non-married individuals can gift up to $15,000 per recipient without triggering the gift tax. Gifts to a spouse in any amount are tax-free. Annual tax-free gifts to a spouse who is not a US citizen increased to $155,000.
Bunch Charitable Donations into a Single Tax Year
Taxpayers now can deduct charitable cash donations equal to 60% of their adjusted gross income. This deduction limitation increased by 10%. If you’ll have a tax burden this year, you may want to bump up your charitable giving to offset your tax liability.
Speak with a Tax Professional in Your State
Florida has its own set of tax and estate planning laws. In order to take advantage of every legal way to save money on tax liability and protect your assets upon your passing, you need to speak with a local legal professional who can offer asset protection techniques to help you build and pass on wealth successfully.
Evaluate Whether You Should Update Old Trusts
When is the last time you looked over the terms of your trust? Perhaps it’s time to reevaluate your trust in terms of changes in the tax laws. In some cases it might be beneficial to decant your trust or pour assets from your trust into a new trust with better terms. You may even be able to do so without court approval.
Have you had your will, trust and/or charitable donation plans reviewed since the Tax Cuts and Jobs Act took effect? Would you like an estate planning attorney to review the terms of your trust or estimate your tax liability? Contact the St. Petersburg wealth preservation attorneys at Legacy Protection Lawyers, LLP today for help.