Call for a FREE Consultation

Estate Tax Planning for Married Couples: What Do I Need to Know?
11April 19

Estate Tax Planning for Married Couples: What Do I Need to Know?

Estate Tax Planning for Married Couples Palmdale CA

Dealing with estate taxes is, on the one hand, a pain in the neck, but, on the other hand, if you don’t qualify for an exemption then congratulations — you’re doing very well. In 2019, the Tax Cuts and Jobs Act raised the exemption to $11.4 million. However, for married couples, that exemption is essentially doubled to ($22.8 million).

These numbers will be adjusted for inflation until 2025 at which point the Tax Cuts and Jobs Act will need to be renewed. If you’re a married couple whose estate is worth less than $22.8 million, then that just about all you need to know. Additionally, estate values passed between spouses are not taxable.

If your estate is valued at more than $22.8 million, then there is a 40% flat tax for anything over the $22.8 million threshold. This is something you will want to know when planning your estate for transfer to your heirs.

To learn more about estate tax planning for married couples, contact a Palmdale estate planning lawyer at Herbert Law Office today.

Estates Under $11.4 Million

While estates under $11.4 million aren’t subject to taxes, married couples should still review their estate plan if they have dependent children or want to leave specific assets to a specific person. Additionally, trusts can be set up for the benefit of special needs children or older relatives. You still have a number of options to consider.

Exemption Portability of Estates Between $11.4 Million and $22.8 Million

Exemption portability, while not a new concept, allows married couples to essentially double their exemption. Estates that are dissolved through death can have the unused portion of their exemption transferred to a living spouse which is something to keep in mind as you plan for your passing.

How Big Estates Can Plan to Limit Their Tax Burden

The portability of exemptions is one thing to keep in mind. Let’s say you have an estate valued at $20 million. You die, leaving the entirety of your estate to your wife. This is tax-free since transfers between spouses are untaxed. You can also pass on the unused $11.4 million exemption to your wife which gives her a total of $22.8 million in estate tax exemptions. When she dies later that year, she can vest the entire $20 million estate to your heirs tax-free.

In addition, there are other moves that you can make to reduce your overall tax burden. These include:

Making annual gifts

Annual gifts essentially reduce the overall value of your estate for tax purposes. As of today, there is an exclusion of up to $15,000. Amounts gifted over $15,000 are subject to a reduction in the overall amount of unified federal estate and gift tax exemption over your lifetime. However, $15,000 gifts can be given to multiple different parties reducing the taxable value of your estate by a large margin.

College tuition and medical expenses

These can be paid for without having to reduce your unified federal estate and gift tax exemption at all.

Give away appreciating assets

If you have not used your unified federal estate and gift tax exemption ever, you can give away assets in the amount of $22.8 million before they become a part of your taxable estate. This is something to consider if you’re looking to reduce the overall taxability of your estate when it passes to your heirs.

Irrevocable life insurance trusts

While life insurance premiums may be written off your income taxes, they are included in the overall value of your estate when you pass it on. That is — so long as you can exercise control over the policy, change beneficiaries, cancel the policy, or borrow against the policy. One way around that is to name your spouse as the beneficiary. Since transfers between spouses are nontaxable, it won’t matter. Another way is to establish an irrevocable life insurance trusts that purchase coverage for both spouses. Since the insurance policies are property of the trust, they are not considered a part of the overall value of the estate and can be used to cover estate taxes or other liabilities of the estate.

Contact Herbert Law Office Today to Learn More About Estate Tax Planning for Married Couples

If you’re interested in setting up an estate plan for your high-asset estate, Herbert Law Office can help you set up a plan that reduces your tax burden. Contact us today to learn more about estate tax planning for married couples.

Request a
Free Consultation

What Our Clients Say

  • Friendly and professional.

    ~ Tomas and Mary C., Lancaster

    unum disability claims
  • Very friendly and easy to work with.

    ~ Michael and Carole S., Acton

    unum disability claims
  • Very helpful, easy to understand. Felt very comfortable.

    ~ Judy W., Lancaster

    unum disability claims
  • (Marc) was very helpful and professional … patient answering all of our questions with cogent explanations.

    ~ Terry and Nancy L., Palmdale

    unum disability claims
  • Very pleasant and staff extremely helpful … open and honest.

    ~ Steve F., Quartz Hill

    unum disability claims
  • Excellent. Pleasant and well-informed …you educated us.

    ~ Raymond and Lori G., Santa Clarita

    unum disability claims
  • Explained everything well. Always available when our schedule changed. Easy to work with.

    ~ Mark and Suzanne F., Lancaster

    unum disability claims
  • Excellent. Easy process.

    ~ Michael and Susan R., Quartz Hill

    unum disability claims
  • Very efficient … (we appreciate) your attention to detail, ability to explain documents in “plain” English, good response time.

    ~ Thomas and Bonnie G., Tehachapi

    unum disability claims
  • We just kept putting it off. Thank you for your patience … (and) one-on-one personal contact.

    ~ Rex and Denise H., Acton

    unum disability claims
  • Very pleasant, patient and accommodating. Great listener … (the) Antelope Valley community should be proud of having such a caring and wonderful person like you, […]

    ~ Hovsep M. and Anna A., Palmdale

    unum disability claims
  • Excellent. Very professional, great attention to detail, seemed to really care … (and) answered all questions.

    ~ Daniel and Linda L., Ridgecrest

    unum disability claims
  • Personable, knowledgeable, explains well. Very happy with the courtesy and expertise in handling our Trust.

    ~ Anthony and Susan C., Lancaster

    unum disability claims
  • It was an easy experience for a hard thing to do. (Marc is) very easy to speak with and made everything easier to understand. We […]

    ~ Bruce and Christina Z., Tehachapi

    unum disability claims
  • (You) were always following up to make sure we had all we needed. Great service … provided a lot of information.

    ~ Carlos and Claudia O., Palmdale

    unum disability claims
  • Excellent. Very informative …friendly … (and) explained things clearly.

    ~ Robert and Joan W., Lancaster

    unum disability claims
  • Marc was great at understanding our needs and he and his staff are so responsive in providing what we need, how we need it … […]

    ~ James and Linda J., Palmdale

    unum disability claims
  • (We appreciate your) thoughtfulness, friendliness and fairness to walk us through the process and helping set up a Special Needs Trust

    ~ Dale and Meryl Z., Tehachapi

    unum disability claims
  • Friendly and welcoming atmosphere. We enjoyed working with Marc. He took time to explain and answer all and any questions … (You) did not rush […]

    ~ Keith and Susan I., Acton

    unum disability claims
  • Marc took his time explaining everything thoroughly to us and answered the many questions we asked. We have busy conflicting schedules, so at times we […]

    ~ Sharron K. and Bonnie M., Palmdale

    unum disability claims
  • Very professional staff … (Marc’s) first hand knowledge of the law (was very important)

    ~ Janet B., Lancaster

    unum disability claims
  • Excellent learning experience … (we appreciate your) expertise in the field.

    ~ Danny and Diane T., Ridgecrest

    unum disability claims
  • (My experience) was quite relaxing and worry-free … (Marc is) honest and answered any and all questions that I had leaving me with good feeling […]

    ~ James G., Lancaster

    unum disability claims
  • Excellent. Very professional and on the other hand very open, which made covering sensitive subjects a lot easier. (Marc is) easy to talk to.

    ~ Wilfred and Julia L., Palmdale

    unum disability claims
  • (Marc) was very patient with (me) … (and) anyone with assets and heirs (would benefit from his services).

    ~ Marcy W., Leona Valley

    unum disability claims
  • It is not fun to plan for one’s death, but you helped us be comfortable. You were very considerate to our needs, especially when it […]

    ~ John and Diane H., Palmdale

    unum disability claims
  • You and your staff were professional, helpful and patient … We took a long time getting everything together and you helped us and were patient […]

    ~ Jerry and Gloria V., Palmdale

    unum disability claims
  • Excellent. Very knowledgeable and helpful 🙂 … Your office was very helpful and persistent in keeping in contact with us during a very chaotic year. […]

    ~ Christopher and Naomi E., Temecula

    unum disability claims
  • We were in good hands with Marc’s expertise through every step. He was thorough. We didn’t feel rushed. We know that you are working for […]

    ~ Randy and Rebecca T., Lancaster

    unum disability claims
  • It was a well-paced comfortable experience

    ~ Richard and Clara H., Quartz Hill

    unum disability claims
  • Excellent. Professional and caring … (I liked) being able to contact you to answer my questions.

    ~ Dwight and Paula C., Palmdale

    unum disability claims
  • It was a pleasant and easy experience working with Marc …. Everyone who believes they and their family will “be alright” without a will and/or […]

    ~ Don and Michelle W., Lancaster

    unum disability claims
  • Marc is friendly and easy to talk to, very helpful. Marc explained everything clearly (and) patiently answered questions.

    ~ Evelyn G., Lancaster

    unum disability claims
  • Everyone is so patient with us and our situation. You’re easy to talk to and share personal stories that help (us) think through (our) own […]

    ~ Michael and Sharon W., Tehachapi

    unum disability claims
  • Excellent. Easy, efficient and thorough. (Marc) understood our goals, (his) explanations were easily understood (and he) always returned our calls. Thank you for your help.

    ~ Richard and Brenda M., Palmdale

    unum disability claims
  • The estate planning process was about as easy as a complex process could be. We liked the personal connection we felt with you and the […]

    ~ Craig and Nancy M., Lancaster

    unum disability claims
  • Attorney Herbert, you explained every detail that I couldn’t understand and (were) very professional (and) patient.

    ~ Donald and Karen B., Palmdale

    unum disability claims
  • You and your office personnel were very friendly and professional. You provided answers and we appreciated the advice you provided. You were organized and were […]

    ~ Robert and Nilsa P., Lancaster

    unum disability claims
  • Your patience and ability to explain the legal processes in layman terminology was important to me. You are good at putting clients at ease, which […]

    ~ Harry S., Palmdale

    unum disability claims
  • Great. Marc always tried to work with our schedules (and) promptly returned our calls. (We liked) your patience in all our many questions.

    ~ Larry and Lane R., Acton

    unum disability claims
  • (Our experience was) very pleasant … (we appreciate) your availability.

    ~ Cliff and Debbie B., Palmdale

    unum disability claims
  • We felt an immediate comfortable bond … I had interviewed 7 attorneys before you. You were always kind and respectful and explained everything so I […]

    ~ Alan and Susan S., Lancaster

    unum disability claims
  • Excellent. You also handled my Mom’s Trust … Marc is willing to take the time to talk with me. Thank you.

    ~ James and Johanna M., Palmdale

    unum disability claims
  • Marc is very professional and quick … (with) friendliness (and) good atmosphere.

    ~ Michael and Cheryl Y., Palmdale

    unum disability claims
  • Marc went above and beyond to ensure we understood every detail … We appreciated his patience and knowledge as well as being flexible with our […]

    ~ Russ and Lucy T., Acton

    unum disability claims
  • Just a sincere note of thanks to you for the extended journey toward my estate plan and for all your guidance and help … The […]

    ~ Carolyn H., Quartz Hill

    unum disability claims
  • The whole process was a great experience. The outcome was excellent.

    ~ Michael and Cynthia M., North Edwards

    unum disability claims
  • Excellent. You did a fantastic job getting back to us in a timely manner even through we were pretty slow on our end … My […]

    ~ Robert and Gina S., Palmdale

    unum disability claims
  • Thank you for being so patient and clarifying everything on my estate plan

    ~ Kathy H., Palmdale

    unum disability claims
  • I want to thank you for everything you did to help me. I will gladly recommend you to anyone.

    ~ Sue S., Quartz Hill

    unum disability claims
  • We appreciate your integrity and honesty. I will recommend you to all my friends.

    ~ Paul and Cheryl S., Lancaster

    unum disability claims
  • I just wanted to say thank you for all you have done. I will highly recommend your legal

    services to anyone looking for a great […]

    ~ Kelly C., Palmdale

    unum disability claims
  • Words cannot express how grateful I am to you.

    ~ Kim D., Acton

    unum disability claims
  • Thank you so much.

    ~ Mike R., Lancaster

    unum disability claims
  • We th good counsel.

    ~ John and Julie K., Lancaster

    unum disability claims
  • Thank you so much. I really appreciate your help.

    ~ Amy K., Quartz Hill

    unum disability claims
  • Just want to say thank you for all of your help and your time. May God bless you.

    ~ Scott D., Palmdale

    unum disability claims
  • Thank you! Thank you! Thank you! Oh, and thank you again!

    ~ Chris B., Quartz Hill

    unum disability claims
  • What else can I say? Thank you big time. We are so appreciative. You deserve our sincere gratitude!

    ~ Mark and Pam B., Lancaster

    unum disability claims
  • Thank you so much for all of your help.

    ~ Linda W., Palmdale

    unum disability claims
  • Remembering you with gratitude. Sincere thanks from the entire family.

    ~ Charles and Danielle S., Lancaster

    unum disability claims
  • Thank you for all of your good work. You’re a great man, and I’ll definitely send you all of my

    referrals.

    ~ Jim L., Quartz Hill

    unum disability claims
  • Marc was very thorough and professional while explaining the legal issues in an easy to understand method. We felt at ease with the entire process […]

    ~ Don and Yvonne (Rosamond)

    unum disability claims
unum claims New York ERISA Attorney

Areas Served :

Proudly serving Palmdale, CA and the surrounding areas.