The federal estate tax carries quite a wallop. At the present time, the rate is 35%, and things will get worse before they get better under current laws. Next year, the maximum rate of the estate tax is 55% so we are talking about serious asset erosion.
Imagine passing along resources to your children and having them receive only 45% of your estate because the government levied a 55% tax on your assets. Disturbing. When they pass away, their children must also pay this federal death levy. This can go on and on, for generations, until the only thing left is the exempt amount.
This is certainly not acceptable, and action is required for individuals who want to preserve wealth for the benefit of succeeding generations. One way of doing this is by funding a dynasty trust.
With these trusts, succeeding generations of your family can receive monetary distributions but no one personally owns the assets so the estate tax is not levied.
These trusts are often started in the state of Delaware because of the favorable laws surrounding them. In Delaware, a dynasty trust can exist into perpetuity, and the state’s laws allow for optimal asset protection as well.
There is no need to take chances with the future financial well-being of those that you love. Steps can be taken to preserve your wealth and a dynasty trust may be a good option for you.
To learn more about these trusts and other tax efficiency vehicles, simply take a moment to set up an appointment to speak with a good Oklahoma City estate planning lawyer.
Author, President and Founding Attorney
Parman & Easterday
- Own Property Out of State? You Need a Living Trust - October 21, 2021
- Three Misconceptions That Lead to Estate Plan Mistakes - October 19, 2021
- Your Original Estate Plan May Not Be the Final Version - October 14, 2021