Plan on It
EPISODE 15
Understanding Advanced Estate Planning for High Net Worth Families
In this episode of Plan On It, host Sean O’Connor is joined by attorney Christopher E. Botti and guest Chris Michail to kick off a new advanced planning series. With over 30 years of experience, Chris Botti, a board-certified specialist in estate planning, trust, and probate law, teams up with Chris Michail, who focuses on advanced estate planning strategies for high net worth families. They delve into the distinctions between regular and advanced estate planning, emphasizing the importance of minimizing tax liabilities and ensuring wealth transfer to future generations. The discussion highlights the significance of estate and gift taxes, especially for estates exceeding $15 million for individuals and $30 million for couples. This episode provides valuable insights into the complexities of advanced estate planning and sets the stage for future episodes that will explore specific strategies in greater detail. Listeners will gain a deeper understanding of how to protect their assets and plan effectively for the future.
Episode Details
I’ve been practicing estate planning for five years, with a background in tax law. My interest in advanced planning grew because it combines tax issues, drafting trusts, and considering clients’ assets and family dynamics. Advanced planning is crucial for families aiming to minimize taxes and ensure their wealth is passed down to future generations.
Regular estate planning focuses on foundational documents like revocable living trusts, powers of attorney, and healthcare directives. Advanced estate planning is for high-net-worth individuals who need more than just basic documents to avoid federal estate tax. It involves techniques to reduce estate tax liability and transfer wealth efficiently to the next generation.
While taxes are the primary driver for advanced estate planning, complex family structures, like blended families, may also require these strategies. Advanced planning can include specific controls in foundational documents to protect family dynamics and ensure smooth wealth transfer.
The gift and estate tax, unified under the IRS system, has increased since 2017. For 2023, the exemption is nearly $14 million for individuals and around $30 million for couples. Estates exceeding these amounts face a 40% tax, making tax planning essential to minimize liabilities.
A common misconception is that advanced planning techniques lead to a loss of control over assets. However, many strategies allow for retained control. For example, certain trusts enable grantors to maintain influence over their assets, dispelling fears of losing control entirely.
We’ll discuss various trusts and planning strategies, such as charitable remainder trusts, family limited partnerships, intentionally defective grantor trusts, and more. Each technique will be explored in detail to help listeners understand their benefits and applications.
The goal is to educate listeners on advanced estate planning techniques, helping them secure their future and their family’s future. We want to raise awareness of these issues and encourage proactive planning for those with significant estates.
