Estate Planning

Advanced Planning Will Minimize or Eliminate Estate Taxes

By Allen Kutchins, Kutchins, Robbins & Diamond LTD

Advanced estate planning during one’s lifetime will minimize or eliminate estate taxes. It is a continual process and is most effective when a plan is in place and it works over a period of time. Following are some of KRD’s favorite planning techniques; however, there are many more available. Implementing these can assure that high networth clients will minimize or pay no federal estate taxes.

1. Utilize your annual gift tax exclusion. Currently at $14,000 per year, per person ($28,000 per person per year if married).

2. Using a Charitable Remainder Trust (CRT). Keep the income, get a current tax deduction, and give the principal to a charity.

3. Convert your retirement savings into a ROTH IRA; accelerate the income taxes due on the retirement accounts and remove the taxes from the estate.

4. Leverage lifetime gifting by using a family limited partnership. Take advantage of discounts for minority interests and lack of marketability.

5. Use a private foundation to zero out your estate. This will allow you to contribute the balance of your estate over the current exemption ($5,500,000 – indexed for inflation); thus eliminating any federal estate taxes. There are unlimited transfers between spouses and the executor can elect to carryover the unused exemption to the surviving spouse. So you can pass $11,000,000 plus any annual gifts you have made to your heirs.


Allen Kutchins

Allen Kutchins

Kutchins, Robbins & Diamond LTD, Chicago, IL, USA
T: +1 847 240 1040
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Allen Kutchins, CPA, is a co-founder and partner of the accounting firm Kutchins, Robbins & Diamond, Ltd. (KRD). With four decades of experience, Allen’s specialties include business and family financial planning; ranging from helping accelerate client revenue growth to succession and estate planning.

KRD Ltd. offers a full range of client services – accounting and software consulting, audit and assurance, tax strategy and preparation, business valuations, and financial planning advisory services. Their team of 50 members has been serving clients for 30 years in Chicago and the surrounding areas.


published: October 2015 l Photo: vichie81 - Fotolia.com

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