Law Offices of Hjerpe & Godinho, LLP
Estate planning is the creation of a definite plan for managing your wealth while you’re alive and distributing it after your death. These assets may be owned by you separately or jointly with others. Clients, when approaching the concept of estate planning, are often bewildered when trying to foresee what the full impact of implementing certain actions will be. At Hjerpe & Godinho, LLP, we navigate our clients through these complicated theoretical concepts so our clients are able to better understand the opportunities afforded by a cohesive estate plan. In today’s world, estate planning can be quite complex, taking into account income and estate tax concerns, health care decisions, business succession and long-term care. Most, if not all of these issues affect not only the person doing the planning but his or her loved ones and families. So often, not doing estate planning can lead to unintended and perhaps unwanted results.
“We will take the time to explain all the decisions and their impact. We help our clients work through the issues in a way that is clear and that allows them to make thoughtful choices, offering them peace of mind that things will happen they way they want when they die.”
Some Tax and Trust Terminology:
Marital Deduction allows spouses to pass unlimited amounts of property to each other without immediate transfer tax consequences.
Applicable Exclusion Amount is an estate and gift tax credit that shelters specified amounts of transfers to anyone other than decedent’s spouse.
Survivor’s Trust a/k/a “A” Trust, receives the surviving spouse’s interest in the trust estate. The marital share may be allocated to a separate marital trust or may be allocated to the Surviving Spouse’s Trust.
Credit Shelter Trust a/k/a Bypass Trust, “B” Trust, Exemption Trust, Residuary Trust, Family Trust, Non-Marital Trust is the receptacle for the portion of the Deceased Spouse’s estate subject to estate tax (i.e., not qualified for the unlimited marital deduction) and is used to absorb the Deceased Spouse’s applicable exclusion amount.
Marital Trust a/k/a QTIP Trust, “C” Trust, Marital Deduction Trust is generally designed to qualify for the marital deduction and is usually the receptacle for the marital share.
Qualified Disclaimer Trust A type of trust that allows for flexible tax planning through use of a disclaimer to a Credit Shelter Trust.