What Do You Need to Consider With a High-Value Estate Plan?

Estate planning is complicated enough on its own. However, if you have assets and property worth millions of dollars, you have much more to think about. While this can seem daunting, a Naperville, Illinois estate planning attorney can help you take steps to protect your interests and make sure your wishes are respected.

At the Gierach Law Firm, we have experience representing clients with high-value estates. Our goal is to provide you with peace of mind, thinking ahead about probate and protecting your beneficiaries. As a certified public accountant and seasoned lawyer, Denice Gierach is equipped to help you make a comprehensive estate plan.

How Can You Pass Down Real Estate Properties in Your Estate Plan?

Real estate is often one of the largest parts of a high net worth estate. Passing down property the right way can help your family avoid stress and unnecessary costs. A revocable living trust is one popular option. When you place a property into a trust, the property can pass to your beneficiaries without going through probate. This can save your family time and money after your death. A trust also lets you control how and when a beneficiary receives the property.

A transfer-on-death instrument is another tool used for real estate in Illinois. This document names a beneficiary who will receive the property automatically after your death. The property does not have to go through probate, and you keep full control of it while you are alive.

If you own property with other people, the type of ownership will shape your estate plan. Joint tenancy with right of survivorship allows a property to pass directly to the surviving owner. Tenancy in common does not include this feature, so that share of the property would need to go through your estate plan instead.

What Do You Need to Do to Pass Down Stocks and Bonds in an Estate Plan?

Stocks, bonds, and other investment accounts can make up a significant portion of a high net worth estate. These assets need special attention, since the transfer process depends on how the account is set up.

A transfer-on-death account is one of the easiest ways to pass down stocks and bonds. With this type of account, you name a beneficiary who will receive the assets directly after your death. The account does not go through probate, and the beneficiary can usually claim the assets by providing a death certificate and necessary paperwork to the financial institution.

Setting up a transfer-on-death account is usually simple. Your financial institution can provide the paperwork needed to name a beneficiary, and you can update the beneficiary at any time while you are alive.

It is important to keep your beneficiary designations updated. Life changes such as marriage, divorce, or the birth of a child can affect who you want to receive your assets. An outdated beneficiary designation can create confusion or even override instructions in your will.

How Can I Protect a High-Value Estate From Creditors?

Protecting a high-value estate from creditors is a common concern. One tool used for this purpose is an irrevocable living trust. Unlike a revocable trust, an irrevocable trust cannot be easily changed or canceled once it is created. This lack of control is also what gives the trust its protective power. Since you no longer legally own the assets placed in the trust, those assets are typically shielded from claims on your estate.

An irrevocable trust can also reduce your taxable estate. Once assets are transferred into the trust, they are typically removed from your estate for tax purposes.

There are different types of irrevocable trusts, each designed for a specific purpose. A special needs trust, for instance, can set aside funds for someone while protecting his or her eligibility for benefits. Others are designed to hold life insurance policies or business interests. An estate planning attorney can help you understand which type of trust fits your goals.

An irrevocable trust involves giving up control of certain assets, so it is important to think carefully before creating one. Working with an experienced attorney can help you weigh the benefits against the trade-offs.

What Can You Do to Reduce Estate Taxes in Illinois?

Illinois imposes its own estate tax in addition to any federal estate tax that may apply (35 ILCS 405/1 et seq.). For a high net worth estate, planning ahead can lower the amount your beneficiaries ultimately owe. Some strategies used to reduce estate taxes include:

• Setting up an irrevocable life insurance trust to keep life insurance proceeds out of your taxable estate
• Making annual gifts to family members to reduce the size of your estate over time 
• Creating a charitable trust to support a cause you care about while lowering your taxable estate
• Reviewing and updating your estate plan regularly as tax laws and asset values change

Every estate is different, so the right combination of strategies depends on your specific assets and goals. An estate planning attorney can review your estate and recommend a plan designed to reduce your tax burden.

Do You Need a Business Succession Plan for Your Estate?

If you own a business, a succession plan is an important part of your estate plan. Without one, your business could face uncertainty, disputes among family members, or even a forced sale.

A succession plan outlines who will take over ownership and management of your business, whether that is a family member, a business partner, or a key employee. The plan should also address how ownership will be transferred, whether through a sale, a gift, or some combination thereof.

Life insurance is often used in succession plans to help a successor buy out family members or cover estate taxes owed on the business. A buy-sell agreement is another common tool. It sets terms for what happens to a business owner’s share if he or she dies, becomes disabled, or wants to leave the business, which can prevent conflict among remaining owners.

Contact Our Naperville, IL Estate Planning Attorney

Protecting a high-value estate takes careful planning and the right legal tools. Contact our Naperville, Illinois wills and trusts lawyer at the Gierach Law Firm or call 630-756-1160 to get started.