There are Lots of Ways to Avoid Taxes on Large Estates. But should we be using them?

Assigning Value to What You Value

Often, those with large estates work with financial planners to maximize their financial security, and an estate planning attorney to minimize the tax burden of their heirs. Yet just because we can avoid taxation on large estates, it doesn’t follow that we ought to do so. It’s easy to forget that we are all interdependent parts of a global eco-system, and that our financial choices do not occur in a vacuum.

In 2024, the lifetime estate and gift tax exemption will be $13.61 million for individuals. That evens out to more than $27 million for married couples. This is the amount that California residents can transfer to others completely tax free, no questions asked. There are some truly talented attorneys who specialize in ensuring that those with larger estates can avoid taxation on even greater sums. The question we too frequently neglect is whether it is prudent to do so.

If you are concerned about social and environmental issues, it’s wise evaluate your estate plan to determine whether you are maximizing the impact you wish to have in these areas. Maybe taxation isn’t the most efficient way to maximize these goals, but it’s also easier to steer a moving ship. If you truly want to have an impact on environmental and social justice matters, we encourage our clients to find ways to do that now, rather than postponing to some date in the future.