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Tax Planning and Succession

Those with larger estates and businesses must consider tax planning and succession along with all the “regular” estate planning tasks. If you own a business and fail to have a succession plan in place, your business could be left vulnerable to conflict and unnecessary taxes. The company you have spent years building could be left in jeopardy. An experienced estate tax planning attorney from Adams Law can help you set your business up in a way that its continued success will be assured. 

Your succession plan can be impacted not only by the type of corporation you have but also by any tax changes and new laws. It might be beneficial for you to set up a retirement plan in order to lower your income and qualify for certain deductions and tax deferments. A comprehensive succession plan can keep you ahead of the game regarding the substantial taxes associated with your business, including estate and gift taxes. Because these are complex issues, it is important that you have a knowledgeable Covington estate tax planning attorney from Adams Law to guide you through the process. 

Why Choose an Estate Tax Planning Attorney from Adams Law?

The experienced Covington estate tax planning attorneys at Adams Law can offer advice and strategies on tax planning issues and business succession issues. We are at the forefront in our industry regarding financial planning for the future, whether that involves tax planning, business succession, charitable giving, probate, or any other estate planning tasks. At Adam’s Law, your best interests always come first—we provide highly individualized care and services for our clients. We will listen to your needs, goals, and concerns, as we handle the most complex tax planning and succession issues. The Adams Law attorneys use technology to level the playing field with much bigger firms, consistently providing comprehensive, affordable legal representation.   

What Is Included with Tax Planning?

At Adams Law, we understand that you have spent a lifetime accumulating assets. You want to be sure that your assets will seamlessly transfer to your loved ones and/or your favorite charities after you are gone.  Estate taxes could potentially reduce the size of your estate or disrupt the transfers to your beneficiaries. When you are conscientious about estate tax planning, your legacy is maximized, and your future tax liabilities are competently managed. 

At their highest, federal estate taxes can conceivably reach 40 percent. Today, every person has what is known as a lifetime estate exemption or a gift tax exemption. This is the amount of assets or money you are allowed to give to your loved ones during your life or after your death without worrying about federal gift taxes or federal estate taxes.   

As of 2022, the federal estate tax administration is $12.06 million, with married spouses being able to double that. The Biden administration campaigned to lower the estate tax exemption, but even if that does not occur, the Tax Cuts and Jobs Act sunsets in 2026. The state of Kentucky currently has no state inheritance tax.  

What Does Succession Planning Mean?

Succession planning is very much entwined with estate planning. If you own a business, your estate plan and succession plan go hand in hand. Your succession plan will determine who will take over after your death, or, at the very least, provides guidance for the transition period between your death and when someone else takes charge. A succession plan is not always related to your death—it can be relevant in preparing for retirement, or even in preparing for a new phase in your life. 

Your succession plan will answer questions like whether there will be changes in management after you are gone, whether there will be other staffing changes, and whether the company’s mission, vision, and plans for the future will remain the same or will change. If you choose for your business to be sold, those details will be included in your succession plan. If the business is to be sold, the tax implications will be considered, and your attorney will help you adjust your estate plan to compensate for the sale of the business. 

How Can You Reduce Your Tax Burden as You Plan Your Estate and Hire an Estate Tax Planning Attorney?

If your estate is large or complex, you will want to find prudent ways to shelter your assets. You might accomplish this by giving during your lifetime to reduce your taxable estate. Giving to charities of your choice or 501(c)3 organizations can help remove even more assets from your personal estate. You may choose to use irrevocable trusts as a method of reducing your potential future tax liability, shifting assets out of your taxable estate. 

Irrevocable trusts have unique features to help minimize the future estate tax burden and may include grantor retained annuity trusts (GRATS), spousal lifetime access trusts (SLATS), or intentionally defective grantor trusts (IDGTs). Irrevocable trusts—as the name suggests—cannot be changed or reversed. Unlike assets in a revocable trust, you will no longer have control of any assets transferred to an irrevocable trust. 

All of these tax planning decisions can involve many complexities, as well as a thorough knowledge of the laws associated with them. Working with an experienced Covington estate tax planning attorney from Adams Law can help ensure you choose the optimal strategies to transfer wealth while minimizing taxes—both current and future. 

How an Estate Tax Planning Attorney from Adams Law Can Help

Choosing a highly skilled Covington estate tax planning attorney from Adams Law is the first step toward ensuring your tax planning and succession strategies are tailored to you and your unique situation. We take the time to fully explain all your options, then help you determine the best way to achieve your goals. The estate tax planning attorneys at Adams Law are ready to help you prepare an estate plan that includes tax planning and succession planning to ensure your peace of mind now and in the future. We believe that once these estate planning tasks are completed, you will rest easy, knowing the assets you have worked hard for will go to those you choose without being overly burdened by taxes. Contact Adams Law today.

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