children

October 26, 2020

Simple End of Year Tax Planning and Wealth Transfer Tips

Believe it or not, the end of 2020 is quickly approaching (insert collective sigh of relief). While I think most of us are ready to start looking forward to 2021 and would prefer to not even have to utter the words 2020 anymore, now is the time to finish off the year strong by reviewing simple, yet important, year-end tax planning and wealth transfer tips.

When most people think of tax planning and wealth transfer, they may have in mind complex estate planning documents and an overload of legal and accounting advice. But that doesn’t have to be the case. Here are three simple tips that you can implement with relative ease, though you will want to consult your tax advisor first.

1. The Annual Gift Tax Exclusion. The simplest tax planning and wealth transfer technique involves the all-too-familiar annual gift tax exclusion. The annual gift tax exclusion is an amount that a person may give to another person without having to file a gift tax return or otherwise report to the IRS. The current exclusion is $15,000 per person receiving the gift. The exclusion is indexed for inflation, but it may only increase in $1,000 increments. Further, married taxpayers may elect “gift-splitting,” which basically doubles the amount of the gift that they may make to one person using the gift tax exclusion; for each person receiving the gift, the limitation would be $30,000 rather than $15,000. For example, if a married couple has two children and four grandchildren, they can give up to $30,000 to each of these people tax-free and without having to report it to the IRS. Therefore, the married couple may transfer $180,000 total to the children and grandchildren. Going further, if the children are also married, the taxpayers may give an additional $30,000 to each child’s spouse, which may be desirable if the child and the spouse hold a joint checking or investment account. Note, however, that a gift tax return would need to be filed if the taxpayers elect gift-splitting. The gifts are not taxable at all, but the IRS would like to know that the $30,000 was gifted via gift-splitting.

December 9, 2016

How to give money without getting a tax headache: Part 1

by English, Lucas, Priest & Owsley LLP

By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

It’s a generous time of year.

There are donations making their way to non-profits, and checks being written in lieu of gifts to family members. If you prefer to give money rather than gifts to children, grandchildren or others on your list, there are a few things you need to know before you write that check.

We’ll address just giving to your children in this blog post; we’ll address giving to charities in part two later this month.

The main point: your gift can trigger your obligation to file a gift tax return if you aren’t careful. We’ll walk you through who you can give to, how you can give and how much you can give. Here’s the official information from the IRS.

September 29, 2015

Choosing a potential guardian for your children in your will

by English, Lucas, Priest & Owsley LLP

By Elizabeth McKinney, Attorney and Partner
English, Lucas, Priest & Owsley, LLP

Estate planning often involves thinking about things you’d rather not, and perhaps the most unpleasant of tasks is to consider who you’d appoint as guardians for your minor or special needs children in the event of your death.

June 9, 2015

Titling a bank account: why it matters

by English, Lucas, Priest & Owsley LLP

Estate law

By Nathan Vinson
Attorney, ELPO Law

It’s a fairly simple act to add someone as a second account holder on a bank account. Usually, a visit to the bank with both persons and signing a few pieces of paperwork is all it takes. We often see clients add an adult child as a co-owner of a bank account, thinking this will make things easier for them should the child ever need to pay bills on their behalf.

There’s a problem, though, with adding someone as an equal account holder. Upon your death, the survivor can keep all of the money in that account. It bypasses probate and does not become part of the estate.

March 26, 2015

Six Things to Do When You Have a Child

by English, Lucas, Priest & Owsley LLP

Having a child can be exciting (and stressful). Probably the last thing you might think to do when having a child is to update an estate plan, but it’s absolutely necessary. Here are 6 things to consider when you have a child.