Tag: Joint Trust

  • Estate and Gift Tax Exemption Changes

    Hau‘oli Makahiki Hou! We hope 2025 is filled with prosperity, vitality and good health for you and your loved ones!

    If Congress doesn’t act, the federal lifetime estate tax and gift tax exemption is due to sunset at the end of 2025 and will revert back to the 2017 exemption amount of approximately $5.6 million per individual, adjusted for inflation. This would result in a significant increase in the number of estates subject to federal estate tax and a higher estate tax liability for estates already subject to the tax.

    Currently per person, the Hawai‘i estate and gift tax exemption is $5.49 million and the federal lifetime estate and gift tax exemption is $13.61 million (or $27.22 million per married couple). If you are married, under the current estate tax exemption and have separate trusts, it may be a good time to explore a joint trust. A joint trust can significantly reduce or even eliminate capital gains tax for your children, should they sell inherited real estate or other appreciating assets.

    If you are hedging up to the current estate tax exemption or you exceed the estate tax exemption, contact your estate planning attorney to see how possible changes to the estate and gift tax exemption may affect you.

    YIM & YEMPUKU LAW FIRM
    2054 S. Beretania St., Honolulu, HI 96826
    808-524-0251 | yimandyempukulaw.com

    Hau‘oli Makahiki Hou! We hope 2025 is filled with prosperity, vitality and good health for you and your loved ones! If Congress doesn’t act, the federal lifetime estate tax and gift tax exemption is due to sunset at the end of 2025 and will revert back to the 2017 exemption amount of approximately $5.6 million…

  • Backwards Planning

    Moving on in life, there are a lot to think about and questions to consider when passing down assets to loved ones.

    • Are you married?
    • Is your marriage a partnership?
    • Are your children from the same marriage?
    • Do you have separate trusts?
    • Do you own a home?

    If you answer yes to any of these questions, consider a Joint Legacy Trust.

    With the new $5.34 million estate tax exemption, only about 0.14% of us will pay an estate tax. Owning a home and passing it on could cause a capital gains tax. Having a joint trust not only reflects and mirrors your life as a partnership, but other benefits include: simplicity, flexibility, and reducing capital gains tax.

    The Joint Trust offers simplicity in that it eliminates the need for obtaining a Federal Identification Number and filing a trust income tax return when the first spouse dies; flexibility to accommodate change after the first spouse’s passing; and reduces capital gains tax by taking advantage of a “step-up” in basis, coined “freebasing” by Forbes Magazine.*

    Separate Trusts were prepared when the estate tax exemption was $600,000 per spouse and helped to reduce estate tax. With an exemption of over $10 million per couple, most of us will not pay an estate tax, and our children may pay capital gains tax unless we change to a Joint Legacy Trust.

    Stephen B. Yim, Attorney at Law | 2054 S. Beretania St., Hon. | (808) 524-0251 | stephenyimestateplanning.com

     * Forbes Magazine, March 2014: “Freebasing Your Estate”. If you would like a free copy of this article, please call me and I will be happy to send you a copy.

    Moving on in life, there are a lot to think about and questions to consider when passing down assets to loved ones. Are you married? Is your marriage a partnership? Are your children from the same marriage? Do you have separate trusts? Do you own a home? If you answer yes to any of these…