Manage your estate tax, gift tax, and federal inheritance tax.
If you want to pass your assets on to your loved ones, or help a child with college or a new house while you’re still alive, there’s something you should know.

Federal estate taxes, federal inheritance taxes, and gift taxes are among the highest you and your family will ever pay. And sometimes states impose their own taxes on these types of transactions.

The more you understand about estate taxes, the more you’ll be able to give.

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Plan ahead

Federal estate taxes and federal inheritance taxes are based on your estate’s taxable value and collected before the inheritance is passed on. There are several deductions you can use to reduce the size of your estate, like marital and charitable deductions of unlimited amounts. And you can pass on your estate tax-free up to a certain amount. But note that gifts given while you’re still alive count toward this limit.

 

Give more

As you consider how to distribute your assets, and to whom, make taxes an integral part of your estate planning process. Know how cash, investments, life insurance, and real estate will be taxed in your situation. And explore the possible tax benefits of gifts, trusts, and charitable donations.

An attorney or tax advisor can help you factor inheritance and gift taxes into your overall estate plan.

 

Give now

You can transfer money while you’re still alive to a loved one as a gift. But there are limits on how much you can give each year and over your lifetime. If yearly giving is under a certain amount, it’s tax-exempt. And contributions for tuition or medical expenses, gifts to a spouse, and donations to charities don’t count against your lifetime giving limit.

Consult with a lawyer or tax advisor first. Gifts that aren’t exempt can incur high taxes.

All investments are subject to market risk, including the possible loss of principal.

This material is provided for general and educational purposes only, and is not intended to provide legal, tax or investment advice. This material does not provide fiduciary recommendations concerning investments or investment management; it is not individualized to the needs of any specific benefit plan or retirement investor, nor is it directed to any recipient in connection with a specific investment or investment management decision.