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estate planning

Estate planning is the process by which an individual or family arranges the transfer of assets in anticipation of death. An estate plan aims to preserve the maximum amount of wealth possible for the intended beneficiaries and flexibility for the individual prior to death. A major concern for drafters of estate plans is federal and state tax law.

An estate is the total property (real and personal ) owned by an individual prior to distribution through a trust or will . For example; cars, homes, land, household items, and bank accounts. Estate planning distributes the real and personal property to an individual's heirs .

Wills and trusts are common ways in which individuals protect and transfer their wealth (see estates and trusts ). Trusts, unlike wills, have the benefit of avoiding probate , a lengthy and costly legal process that oversees the transfer of assets. Sometimes, though, it will be useful to make inter vivos  gifts (gifts made while the donor is alive) in order to minimize taxes. The federal gift tax  exempts certain levels of lifetime gifts. (See estate tax )

Federal Material

U.S. Constitution and Federal Statutes

• U.S. Code: 26 U.S.C. Subtitle B - Federal Estate Gift Tax

Federal Agency Regulations

• Code of Federal Regulations: 26 C.F.R. Chapter 1, Subchapter B  - Estate (Part 20) and Gift Taxes (Part 25)

State Material

State Statutes

• Uniform Laws:

  • Uniform Probate Code

  • Uniform Trust Code

  • Fiduciary Income and Principal Act

• State Statutes Dealing with:

  • Probate

  • Property

  • Taxation

Additional Resources

• Internal Revenue Service

• National Association of Financial and Estate Planning

• National Network of Estate Planning Attorneys

• American Academy of Estate Planning Attorneys

Illustrative Cases

• Leff v. Fulbright & Jaworski, L.L.P 78 A.D.3d 531 (2010)

• Hall v. Kalfayan, Cal. Rptr. 3d 637 (Cal. Ct. App. 2010)

• Estate of Moore v. Commissioner of Internal Revenue, 2020 TC Memo 40 - Tax Court 2020

[Last reviewed in December of 2022 by the Wex Definitions Team
]

Wex

• taxation

• LIFE EVENTS

• family & personal matters

• elder law

• financial events

• wills

• PROPERTY

• property & real estate law

• trusts

• inheritances & estates

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• family law

• legal education and practice

• property law

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