As someone currently working on your Iowa estate plan, chances are, one of your main objectives involves leaving as much of your hard-earned assets behind for your loved ones as you possibly can. While there are various methods you can rely on to accomplish this, one method involves minimizing the amount of taxes your loved ones will have to pay on your estate. At Janssen Law, PLC, we are well-versed in the various methods you can use to reduce estate taxes, and we have helped many clients accomplish these and related goals.
According to U.S. News & World Report, one way you can reduce the amount of taxes assessed on your estate involves placing your assets into a trust. Unlike assets you leave behind in, say, a traditional will, assets you enter into a trust do not come into play when determining the entire value of your estate. In other words, you can leave your loved ones assets in a trust and know that, by doing so, you are reducing the amount of taxes owed on the estate.
Another tactic you may be able to utilize to reduce estate taxes involves buying additional life insurance to cover the cost of estate taxes. In doing so, however, it is critical that you also set up an irrevocable life insurance trust to purchase the policy in the first place. That way, the value of the policy does not affect the overall value of your estate.
A third method you can consider using to reduce estate taxes involves simply giving away some of your wealth now, while you are still alive. Whether you give directly to your children, to charity or what have you, giving away some of your wealth now will reduce the amount of taxes assessed against your estate after your passing. You can find more about estate planning on our webpage.