Estate Tax Changes: Will They Affect You?

On this week’s episode of THE FINANCIAL COMMUTE, host Chris Galeski welcomes Estate Planning Attorney Brian Standing to discuss upcoming estate tax law changes and how they may affect you. 

-          The estate tax exemption as of today is $13.6 million per individual, meaning estates valued over this amount are subject to estate tax. This amount is expected to be cut in half to about $7 million at the end of 2025. 

-          Using entities like Family Limited Partnerships (FLPs) or Limited Liability Companies (LLCs) for estate planning can lead to discounted valuations of transferred assets, potentially reducing estate taxes.

-          The strategy of holding onto high-appreciation assets to benefit from a step-up in basis at death is discussed, highlighting the trade-off between avoiding capital gains tax and potential estate taxes.

-          Real estate presents unique challenges in estate planning, including issues with leverage (loans), depreciation recapture, and property tax reassessment. 

-          Brian and Chris stress the importance of careful planning and timing when gifting assets to ensure that the chosen strategies align with the individuals' overall financial goals and estate planning objectives.