The Eleff Law Group, located in Bethesda, Silver Spring and Frederick, Maryland, has decades of experience assisting numerous families throughout Maryland in transferring assets to future generations. Planning for the most efficient transfer of wealth from one generation to the next requires an in-depth knowledge of state and federal estate tax laws.
Susan Eleff and her legal team work with high net worth clients to create strategic estate plans for high net worth individuals who need to protect their family wealth and business interests while limiting tax exposure.
Estate Planning Tools for Tax Planning
Susan Eleff and her attorneys implement plans that both minimize taxes and minimize changes in lifestyle for you and your heirs. A well-designed plan will utilize available gift, estate and inheritance tax exemptions, while preserving what is known as the "step up in basis" of assets upon death. The following are several strategies The Eleff Law Group may recommend and draft for clients, depending on their specific circumstances:
Family limited partnerships: A family partnership or limited liability company is usually composed of related family members who own discrete interests in a pool of assets. FLPs are typically created by parents and grandparents to transfer family businesses or other investments to the next generations. FLPs provide significant estate tax and federal gift tax benefits when coupled with valuation discounts, which take into account marketability and control characteristics.
Life insurance trusts: If properly structured and maintained, proceeds of policies of life insurance owned by a trust may be excluded from the estate of the decedent, making those proceeds tax free both to the estate and the trust beneficiaries.
Asset protection: Spendthrift provisions in a trust can shield assets from an heir's creditors and may keep them from being deemed marital assets in an heir's divorce. Certain irrevocable asset protection trusts may allow a grantor to have limited control over the assets while remaining insulated from creditor burdens.
Qualified personal residence trusts (QPRTs): A grantor-retained interest trust can be used to transfer a grantor's residence out of his estate at a low gift tax value, allowing the grantor to live in his home for a number of years, rent free, with his remainder beneficiaries becoming fully vested in their interest at a certain point in time. By complying with certain IRS provisions, the transfer of the residence to the trust constitutes a "completed gift" value determined by statute, allowing the residence and future appreciation to be excluded from the grantor's estate if he survives the term of the trust.
Qualified domestic trusts (QDOTs): A QDOT is a very specific trust designed to address the estate tax situation that arises when the spouse of a non-US citizen dies while leaving significant assets to a noncitizen surviving spouse. Noncitizen surviving spouses do not qualify for the federal estate tax marital deduction. With a QDOT, the assets can go into the trust upon the grantor's death, with the surviving noncitizen spouse as a trust beneficiary. When that spouse passes away, the assets will go to the next beneficiaries named in the trust, with estate taxes deferred until the surviving spouse's death.
A well-conceived and well-drafted estate plan does more than direct assets to beneficiaries. Your estate plan should also take into account the need to distribute assets to the desired recipients quickly, minimize taxes and provide an orderly and efficient transfer of business interests. Susan Eleff and her lawyers will help you navigate these issues and many others in order to efficiently and effectively pass your wealth down to the next generation.
Learn More About Estate Planning, Tax Savings and Asset Preservation
To discuss the estate planning and tax issues surrounding your high net worth estate please contact The Eleff Law Group for a *free 15-minute in-person or telephone initial consultation. Please call 800-765-2662 or fill out this form to schedule your consultation.
*Certain limitations may apply.