One of the most important estate planning considerations for high net worth individuals is the potential impact of the federal estate tax. The tax carries a top rate of 40 percent, so we are talking about a very significant bite. At the current time, the estate tax credit or exclusion stands at $5.34 million. Anything that you want to transfer that exceeds this amount is potentially subject to taxation. Those who are exposed to the estate tax must take steps to gain estate tax efficiency. There are a number of strategies that can be implemented effectively. One of them is the zeroed out grantor retained annuity trust strategy. Let s look at the details. Highly Volatile Assets When you fund a grantor retained annuity trust, you are removing those assets from your estate for estate tax purposes. However, you name a beneficiary when you create the trust. The beneficiary would assume ownership of any remainder that is left in the trust after its term expires. Because a beneficiary may be
Posted on: Tue, 22 Jul 2014 13:50:20 +0000
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