For those who haven't revamped their estate plans since the Trump administration, perhaps they should seriously consider it. Since Donald Trump's government made changes to federal tax laws, Illinois residents will find they will be able to leave more tax-free assets to their beneficiaries. Trusts, although still useful in many respects, may not be the only way of tax sheltering wealth.
As the law stands now, people can bequeath a touch more than $11 million to their children or to non-charitable heirs with being slapped with a federal estate or gift tax. But financial planners have found a way for each spouse to be able to do the same, which means that amount doubles to $22 million. As for trusts, they can also be used now to reduce income taxes.
So, people who haven't reviewed their trusts in a while should do so. Having them amended just makes sense in light of the current laws. Additionally, there are new ways of using trusts to shelter funds. For instance, the mother-in-law trust gives a mother-in-law or any senior relative some form of control of an irrevocable trust that is funded with low-basis assets. When the relative dies, assets in that trust are boosted to the spouse and others named within the trust, and it can prove to be a capital gains tax-saving measure.
There are so many laws that accompany estate planning and trusts. An Illinois estate planning attorney may be able to counsel his or her clients on what those are and how they can be beneficial to each unique circumstance. An attorney may be able to clarify how a trust can be a financial saver for a client's beneficiaries.