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Estate Planning For The 99.5% Of Americans

In 2017, the Tax Cuts & Jobs Act of 2018 (TCJA) effectively repealed estate tax by doubling the amount of wealth that could be transferred tax exempt from $5.5 to $11.2 million.

In 2022, lifetime and post-mortem gifts of $12.06 million are exempt from taxation. Allowing joint filers (read: couples) to pass $25 million to their heirs tax-free redefined the rules of estate planning not only for the top one-half of 1% of taxpayers, it also rewrote the rules for how the other 99.5% pass their assets to their spouse, children, grandchildren, charities, and create a lasting legacy.

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Beneficiary forms and titling of your assets are crucial estate planning decisions for 99.5% of Americans who do not have taxable estates. This is a financial planning issue not reported on in the major financial media outlets because it’s not breaking news. However, it is strategic planning for a legacy, that could keep your spirit and values alive for generations to come.

How you title securities accounts held in IRAs, 401(k) and other federally qualified retirement accounts as well as real estate and other assets, is estate planning for 99.5% of Americans. Estate planning was once only for the richest Americans. Now, even if you’re not among the top one-half of 1% of American taxpayers, creating a legacy by designating who will inherit your qualified retirement accounts can change the future for your children, grandchildren, and support charitable causes you care about.

Because of changes in state property laws and the increase in the estate and gift tax exemption, creating a legacy – once the province of legal professionals only -- is a topic to talk with us about.

Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances.
The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions.
This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.


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This article was written by a professional financial journalist for Financial Planners and is not intended as legal or investment advice.

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