Estate plans can provide many protections for those who utilize them. For many affluent California residents, reducing estate taxes is often of concern. Fortunately, estate planning can help them achieve that goal, but it is important that plans are updated when changes to the law take place.
Many wealthy individuals across the country are concerned that the upcoming presidential election could result in serious tax changes. In particular, if the Democratic candidate wins the election, it is possible that the exemption amount for estate taxes could be lowered significantly. Reports indicate that it is possible for the current $11.58 million limit to be cut to approximately $5 million.
Currently, the laws in place allow for the $11.58 million exemption to continue until 2026. However, the election could result in a change to the law that reduces that amount sooner. As a result, many individuals are considering ways that they can change their estate plans in efforts to avoid possible taxation on their estates. Of course, making changes too early may not benefit them as much as they had hoped, especially if the changes do not occur, so timing is important for this matter.
Reducing estate taxes could allow for more of an estate’s assets to pass on to other generations. Unfortunately, laws can change, and if California residents do not change their plans to address those legal changes, they may not have as much protection as they had hoped. If individuals do have concerns about how their estate plans could be affected by future tax changes, they may want to discuss those concerns with legal professionals who could provide valuable insight.