Maximizing Estate Tax Savings with SLATs

Spousal Lifetime Access Trusts (SLATs) allow you and your spouse to use your full remaining gift tax exemptions while retaining access to the gifted property in the event you need it.

The more complex your goals, the more crucial the timing. This is especially true if you want to maximize your estate tax savings under the current $5.12 million estate and gift tax
exemption set to expire at the end of 2012.

So, how can spouses maximize their giveaways and still retain some takeaways when it comes to their wealth? Forbes recently considered this question in an article titled “Spousal Lifetime Access Trusts—Use Your Gift Tax Exemption Without Giving It All Away.” The answer: a Spousal Lifetime Access Trust—SLAT.

Essentially, with the SLAT approach, each spouse can give their respective $5.12 million exemption amounts into separate irrevocable trusts. But each spouse also names the other as
the SLAT beneficiary and other loved ones (their children, commonly) as secondary beneficiaries.

There are some very important steps required for a SLAT to pass IRS muster, to include avoiding application of the dreaded “reciprocal trust doctrine.” Do not undertake any estate
planning without the advice of competent legal counsel.

Contact Meier Law Firm to discuss how you can incorporate a SLAT into your estate planning.


Reference: Forbes (August 9, 2012) “Spousal Lifetime Access Trusts–Use Your Gift Tax Exemption Without Giving It All Away

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