Letter: Federal estate taxes perplexing
To the Editor:
Are you as perplexed as I am that the elimination of federal estate taxes is seriously proposed with so many tools and techniques already available to the wealthy?
Currently, and in the recent past, the wealthy can make gifts and sales of assets to trusts for family benefit, funding family foundations creating employment for family, use executive and discriminatory employee benefits, annual and lifetime gift tax exemptions, even decanting of existing trusts and crafting perpetual trusts are of great value to wealthy family asset transfer.
And then after all those tools and techniques come to bear … if the “leftover” estate is over $5.5M-$11M, then a federal estate tax begins. Even that estate tax liability and probate expenses can be mitigated using life insurance premiums gifted to an ILIT (irrevocable life insurance trust) with Crummey provisions to pay the taxes at a significantly discounted rate.
With all these tools and techniques available to reduce taxes and boost transfers to family, the lazy rich family (does no planning while alive) and frugal rich family (doesn’t want to pay for legal, accounting or financial advice) should pay, along with any estates of more than $11M, a very, very significant estate tax.