Health & Fitness
Why move to Florida? Avoid both Federal and Illinois State Estate Taxes with a Spousal Access Gift Trust
A common goal of estate tax planning is to remove future asset appreciation from a client's taxable estate by way of gifting. One gifting technique used to accomplish this goal is the Spousal Access Gift Trust. Such trusts can be flexibly designed to benefit and protect any one or more of the donor's spouse, children, and grandchildren from estate taxes, generation-skipping transfer taxation, personal spending habits, mental disability, creditors, divorces, etc.
With proper planning there is no transfer tax need for most married taxpayers with taxable estates under $10.68M to move out of Illinois to Florida (or other states which do not have an estate tax) to attain solid estate tax planning results. During 2014, Spousal Access Gift Trust planning allows a donor spouse to make lifetime in-trust gifts to benefit the donee spouse of up to $5.34M, without paying either federal or Illinois gift tax, and remove any future appreciation associated with the gifted assets from being subject to federal and Illinois estate tax upon death. A great result. The typical Spousal Access Gift Trust commonly names the donee spouse as both a trustee and the primary beneficiary, with the children as secondary beneficiaries. So, subject to certain limitations, the donee spouse, as both a trustee and the primary beneficiary, may maintain significant control and access to the protected in-trust gifted assets. Provisions may also allow the donee spouse to benefit the donor spouse if the donee spouse predeceases the donor spouse.
Although Spousal Access Gift Trusts can be used with most assets, such planning can be leveraged when used in conjunction with proper life insurance planning, family limited liability company, S-Corporation planning and provide further economic benefits. Furthermore, Spousal Access Gift Trusts can provide families with enhanced asset protection. In summary, for clients who do not desire to move to Florida (or other states without an estate tax), Spousal Access Gift Trusts can be designed to avoid both Federal and Illinois estate taxes as well as fully utilize the generation-skipping transfer tax laws to provide dynasty trust planning thereby avoiding transfer taxes over the generations.For more information on how we can assist you, please contact us at 847-382-9130.
