Tax Planning Attorney in Orange County
Estate Planning Services for Southern California Families
At P. Arnsen Blakely we help Orange County, California clients with their
tax planning. As we have been doing this since 1971, we have intimate
knowledge of income tax and
estate tax laws and how to minimize their impact on our clients. We keep current
on tax code changes at the state and federal level so that we can keep
clients informed on how that may affect their tax planning. For experienced
tax guidance, we urge you to contact an
Orange County estate planning lawyer at our firm today by filling out our
free case evaluation from.
Estate taxes apply to your estate at death. They are colloquially referred
to as the
death tax, and are the subject of much debate. You of course will want to minimize
this impact on your estate so that you can pass on as much of your wealth
to your family as possible. There is an exemption amount which allows
your estate to pass untaxed up to that limit. While the exemption formerly
would fluctuate from year to year, the U.S. Congress has recently fixed
it at $5.12 million, with a tax rate of 40 percent for any amounts not
subject to the exemption. Unlike many states, California does not impose
its own estate tax.
Strategies for Passing Wealth
The most advisable course of action for most people hoping to pass wealth
on to their heirs is to adopt strategies to transfer as much as possible
of your assets outside of your estate. This makes them immune from estate
taxes. By starting now and doing it annually in relatively small amounts,
you can avoid gift taxes as well. If you wish to retain the benefit of
the assets during your lifetime, you may make the gifts to
irrevocable trusts. The trustee is directed to provide for your needs until your death and
then pass the remaining trust funds to your children, either in a single
lump sum distribution or over a longer period of time according to a predetermined schedule.
Limited Family Partnership
Where you have a business, you may avoid estate taxes by establishing a
limited family partnership. You retain control of the business as the
general partner while giving limited partnership interests to your children.
You may have to pay gift tax on the transferred interests but you can
discount that value for tax purposes. This is because you are denying
your children control or transferability of their interests. At death
the interests revert to their full value and no estate tax is due because
the interests have already passed.