Estate & Wealth Transfer Planning
The estate and gift-tax exemption is about to get cut in half, exposing exponentially more wealthy Americans to the death tax. They can minimize or eliminate the tax, if they act before the deadline.
Help clients avoid a voluntary tax of $400,000 per $1M of wealth!
Talk to clients with a wealth of at least $10M. Do they love their families and hate paying unnecessary taxes? Start a conversation about their options – before it’s too late!
Life insurance owned by a special trust is one highly efficient strategy to deal with the tax, creating a massive opportunity for Financial Advisors. It’s never been easier to open giant life insurance cases you’ll remember for the rest of your career! Deploy the tools on this page to start that important conversation with clients and prospects.
Marketing Resources
WSJ 2023 Tax Guide (Download, see P. 17)
WSJ Tricks the Wealthy are Using
Make Sure Your Clients Think of You First – Leverage WSJ Articles to Your Advantage
Collaborate with Estate Tax Planning Expert: Tom Lipscomb
Do you primarily help your clients with their investments other lines of insurance? Are you up-to-date with the latest tax mitigation and elimination strategies? Different flavors of ILITs? If you’re not sure, invite estate and wealth transfer planning expert, Tom Lipscomb, to guide you and your clients through the maze of options. Gain access to his decades of experience and approach your clients with confidence! Watch how Tom introduces your clients to sophisticated tax-reduction strategies he has optimized just for them. Reach out to him now so he can help your clients avoid the voluntary $400,000 tax per $1M of wealth before the deadline!
Effective Client Conversation Starters
Remind your clients why you are uniquely qualified to assist them with estate tax mitigation and elimination strategies. Keep your name in front of them with a new article or idea on monthly basis. Check back often for new resources you can use to stress the urgency to act before they miss the deadline.
- 2023 Wall Street Journal Tax Guide (download the guide, then focus your clients’ attention on P. 17)
- Updated State Death Tax Chart
- Open cases with Simple Estate Tax Estimator Tool
- Request Client-Specific Estate Tax Estimator
- Comprehensive Guide to ILITs with Specimen Docs for Attorneys
Background: Changes to Estate and Gift Taxes
The high estate-and gift-tax exemption expires at the end of 2025. This change will require millions of additional taxpayers to plan for these confiscatory taxes impacting their families immediately after their death.
The federal estate-and gift-tax exemption applies to an individual’s taxable gifts made during life, and assets left at death. Above the exemption, after deductions for items such as charitable bequests, the tax rate is 40%. Some states layer their own death taxes on top.
Many of your wealthy clients’ families will have to come up with millions of dollars to pay the tax, just a few months after their loved one’s death. What is their current plan to pay the tax when the IRS comes calling?
Unique Opportunity 2018 – 2025
As part of the 2017 tax overhaul, Congress roughly doubled the exemption beginning in 2018, adjusting for inflation after that date. For 2023, the inflation adjustment has lifted the exemption to $12.92 million per individual, or $25.84 million per couple.
While the current large gift-and estate-tax exemption is set to expire at the end of 2025, clients can lock in today’s larger amounts by acting now. The IRS has already stated that transfers prior to 2026 will escape tax increases. Let’s look at an example provided by the Wall Street Journal on P. 17 of their 2023 Tax Guide.
Grandfather Opportunity
The IRS has already confirmed that gifts made under the current high exemption amounts will be grandfathered. This means taxpayers who make gifts up to the maximum allowed under current rules, do not have to fear a claw back once the exemption amounts return to pre 2018 levels. Let’s assume Rachel gifted $11 million in 2020 to a trust outside her estate, naming her heirs trust beneficiaries. This transfer was free of gift tax, because the exemption was $11.58 million in 2020.
In 2026 Congress lowers the exemption to $5 million per person (this amount will be inflation adjusted). Rachel dies in 2027. Under IRS guidelines, Rachel’s estate won’t owe tax on any portion of her $11 million gift, even though $6 million of it is above the $5 million limit in effect at the time of her death.
Clients Must Take Action Now
By acting prior to the deadline, Rachel helped her heirs eliminate $2,400,000 in unnecessary taxes (40% of the $6,000,000 she moved out of her estate before 12/31/2025).
Engage your clients while they can still shelter significant assets from the death tax. Order client-specific versions of our Estimator in advance of all your upcoming appointments with your high net-worth clients. Start that important conversation, now.
