Prince Law Firm
Call For A Consultation
Toll Free 866-383-1125
Local 248-419-1968

Tax planning for the future - what changes do you need to make?

Our Michigan readers who are familiar with previous posts here know that when it comes to protecting inheritance, there are numerous options available. Whether the primary goal is tax planning to pay the minimum amount necessary, or to make absolutely positive a designated beneficiary receives exactly what the estate planner wants them to receive, trusts can be one of the best options. However, our readers are probably also familiar with the fact that the United States Congress recently passed some new tax laws. In light of those changes, how are trusts going to be affected?

According to a recent article, trusts may be used less often. The primary reason? The federal estate tax exemption. Many trusts, whether a revocable trust or irrevocable trust, are implemented to avoid taxes for as long as possible, or to avoid taxes all together. With the federal estate tax exemption set at $10.5 million for married couples, or $5.25 million for a single individual, many people, even some of the most wealthy, will have estate values that come in under this total. When that happens, no federal estate tax would be owed, only state level estate taxes would be a concern. Anything over that, however, would be taxed at a 40 percent rate at the federal level.

Although the use of trusts will most likely continue, the exact goals behind the implementation of a trust may need to be reconsidered. And, for those who have already established a trust, a review of the goals and needs of the trust might be prudent.

There are thousands of different configurations for a sound, comprehensive estate plan. Many will include trusts, some will not. However, one thing is certain: tax laws will have an impact across the board on what the best plan is for the situation.

Source: Palm Beach Daily News, "New tax laws may make trusts unnecessary," Gail Liberman, Feb. 3, 2013

No Comments

Leave a comment
Comment Information

How Can We Help You?

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Our Office

Prince Law Firm
800 W. Long Lake Road, Suite 200
Bloomfield Hills, MI 48302

Fax: 248-865-0640
Bloomfield Hills Law Office Map

Connect with us

  • Facebook
  • Twitter
  • Linkedin
VISA | Master Card | American Express | Discover Network