Estate Planning Case Study: Maximizing Estate Tax Exemptions

Client Background

Meet the Davis family, consisting of John, Mary, and their three children.  Their assets included a jointly owned home with $400,000 in equity, $150,000 in investments, John's $270,000 401(k), Mary's 401(k), and life insurance policies totaling $300,000.  While these assets, when the joint interests were divided, kept each of them just below the Massachusetts estate tax threshold, a recent inheritance had significantly increased their net worth, putting them well above it.  In addition, they held business interests in an S Corporation, whose valuation was unclear.​

Estate Planning Solutions

1. Maximizing Spousal Estate Tax Exemption: Given the substantial value of their assets and the potential estate tax implications, we recommended the establishment of trusts for both John and Mary. By doing so, we could leverage their spousal estate tax exemptions to preserve as many assets as possible for the family's future generations. This approach ensured that their hard-earned wealth remained intact and protected from excessive taxation.
   
2. Wills: To address their immediate needs and safeguard their assets, we drafted comprehensive wills for John and Mary. These documents outlined clear instructions for asset distribution, ensuring their desires were legally binding.
   
3. Healthcare Proxies (HCP): To provide each family member with peace of mind regarding healthcare decisions, we prepared healthcare proxy documents. These authorized individuals to make crucial medical choices if necessary, aligning with their preferences.
   
4. Powers of Attorney (PoA): We also created power of attorney documents for John and Mary. These empowered them to designate trusted representatives who could manage their financial and legal matters in case of incapacity.
   

Conclusion

The Davis family's estate planning journey demonstrates the importance of proactive measures to preserve wealth and minimize estate tax burdens. Through careful consideration and personalized solutions, we assisted them in achieving peace of mind, knowing that their legacy would endure and provide for generations to come.

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Our estate planning solutions are tailored to your unique needs, just like we did for the Davisfamily. We can help you maximize your wealth and minimize estate tax liabilities, ensuring peace of mind and financial security for generations to come.  You can use the button below to schedule a call back from a member of our team, or give us a call at  781-784-2322.

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