We all traverse our career paths in an effort to become successful, and it can be quite gratifying to achieve your financial goals. When it happens you have earned the right to breathe a sigh of relief and enjoy the view from the top. But at the same time you must be proactive about tax efficiency and asset protection so you can retain ownership of what you have earned.
It is a controversial subject but the tax man is crouched around every corner, looking for money. At some point you may recognize the fact that you will have significant resources left over after you pass away. At that point “The Tax Man Cometh.”
There is an estate tax in place; it is unified with the gift tax. Today there is a unified $5.12 million exclusion. So if you give $3.12 million worth of non-exempt gifts throughout your life you have only $2 million of your exclusion remaining to shelter your estate from taxes.
It should be noted that this exclusion amount is being reduced to just $1 million beginning January 1 of next year.
Another thing that you have to concern yourself with beyond taxation is asset protection. We live in a rather litigious culture and some people who have been able to accumulate significant wealth are particularly vulnerable to lawsuits.
Once you have worked with an established legacy planning attorney to address these concerns you must always remain vigilant as changes to the tax code are implemented and things in your life change.
You don’t want to go a single day without an up-to-date estate plan as a person of means. There can be millions of dollars in the balance and nobody knows with any certainty what the immediate future may hold.
Larry Parman
Author, President and Founding Attorney
Parman & Easterday
Latest posts by Larry Parman, Attorney at Law (see all)
- Who Needs Estate Planning in the Kansas City Area? - February 25, 2020
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- How Long Will It Take to Probate My Father’s Estate? - February 18, 2020
