manner of minimizing estate taxes at death. It involves deriving the most favorable tax treatment of wealth. Inheritance is passed on to beneficiaries with the smallest amount given over to taxes. Tax planning aspects for estates include: (1) determining what financial strategy could be developed taking into account the particular assets being considered; (2) the transfer of assets before the taxpayer's death (i.e., transfer title of property to those in low tax brackets); (3) drafting a will considering the tax and asset transfer ramifications (i.e., property can be transferred between spouses without any tax because of the unlimited marital deduction); and (4) having appropriate terms in life insurance policies.
planning for the orderly handling, disposition, and administration of an estate when the owner dies. Estate planning includes drawing up a WILL, setting up trusts, and minimizing estate, income, and trust taxes. In a broad sense, it is the art of designing a program for the effective enjoyment, management, and disposition of property at the minimum possible tax cost.
planning for the orderly handling, disposition, and administration of an estate when the owner dies. Estate planning includes drawing up a will, setting up trusts, and minimizing estate taxes, perhaps by passing property to heirs before death or by setting up a bypass trust or a testamentary trust.
procedure for accumulating, conserving, and distributing personal wealth. In essence, estate planning focuses on enhancement of the value of an estate and its conservation. At the death of an owner, estate planning seeks to transfer the estate to the heir(s) with a minimum loss in taxes and other expenses. Depending on the size and nature of an estate, the expertise of one or more of these specialists may be useful: lawyer, accountant, life insurance agent, banker, or a qualified financial or estate planner.
