Estate Planning

After working a lifetime to accumulate savings, current estate tax laws would have wealthy families leave about half of their wealth to the government in the form of estate taxes.

Golden Trail Advisers helps its clients navigate these complex waters effectively. The estate tax laws underwent major changes with the amendment in 2001. Then, in 2010, further changes were implemented. We encourage clients to make plans for their estate. The alternative is to let your state of domicile apply its own "logic" to your estate upon your death.

The key to effective estate planning is to build a framework that addresses the issues which are important to the family, while leaving flexibility to accommodate changing needs and changes to the laws. For example, you want to make sure you or your beneficiaries have the flexibility to replace a corporate trustee if the firm was not doing a good job for the beneficiaries.

The tools that can be used to offset or eliminate estate taxes can be difficult to understand and even harder to implement – without proper guidance. Mike Sedlak, Managing Member of Golden Trail Advisers, has been an instructor for the module on Advanced Estate Planning Concepts for the Exit Planning Institute. In addition, we have been through the estate planning process with many different families, all with different goals and circumstances.

Some of the more common techniques that can be used:

Once the most basic part of the estate plan, the 2010 estate tax law performs the function of an A/B trust automatically. The effect of an A/B trust is to double the amount of wealth that can be excluded from each couple's taxable estate. With the latest law, the only reason to establish this former staple of the estate planning toolbox is if you believe the law will change back to the way it used to be. This is a valid concern because if Congress does not act by 2012, the sunset provision goes into effect and triggers pre-2001 provisions.

One way to reduce estate taxes is to gift away the estate over time. Congress has allowed annual amounts ($13,000 in 2011) that can be gifted to any individual each year without any tax consequence. While $13,000 does not sound like a lot, a married couple with three married children can remove $156,000 per year from their estate.

In combination with lifetime or annual gifting, family limited partnerships can be effective in transferring money out of the estate. One benefit of the family limited partnership structure is the ability to give away partial interests in assets like businesses or real estate that are hard to divide on their own. A second benefit is the use of discounting to increase the amount of value that can be removed from the estate. Given enough time, assets can be placed into a family limited partnership and gifted away to dramatically reduce the potential estate tax liability. The following link is to a Wall Street Journal article on family limited partnerships:


Trust structures, such as GRATs and IDGTs (Grantor Retained Annuity Trusts and Intentionally Defective Grantor Trusts) can be used as a way to sell or gift assets to remove them from the estate at a discount. These types of trusts are irrevocable and should be used only when all aspects of the situation "fit" the technique.

Use of Irrevocable Life Insurance Trusts can get the death benefit of even very large life insurance policies out of the estate. This structure is fairly simple, but often not implemented properly. For example, there is a requirement for an annual notice that is not always completed.

The opportunity to reduce your potential estate tax increases greatly if you want to support charitable causes through Charitable Lead Trusts or Charitable Remainder Trusts. In addition, some charitable organizations have their own donor advised funds which do not have all the flexibility of setting up your own charitable trust, but they are simple to use.


Using these tools, alone or in combination, can mean the difference between leaving your hard-earned money to your family and favorite charities or the government. Helping clients get their arms around their estate plans is just one more way Golden Trail helps you on "your path to financial well-being."

Estate Planning


Elder Law and Long Term Care

One specialty area of estate planning is protecting your life savings from the costs of long term care. Issues range from whether to purchase long term care insurance, to how to best structure your assets for self insurance. Assistance with these delicate issues and access to expert attorneys is another way we help with your financial well-being.

How Did George Steinbrenner Avoid Estate Tax on His $1.5 Billion Estate?

A provision in the tax code called for the repeal of estate taxes in the year 2010. Since George died in 2010, he does not have to pay estate tax on $1.5 billion estate. People have called 2010 "a good year to die."