Anonymous wrote:We put assets that are currently low value but likely will increase in value (part of a business). That is really the point of these things. To lock in appreciable assets before they appreciate and get them out of our estate. We also have an irrevocable life insurance trust (Crummey).

The amount of assets is highly dependent upon your situation and goals.

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Anonymous wrote:If you have an irrevocable trust, how did you decide how much to transfer into it? What percentage of your NW did that represent? Thank you.

My siblings and I are beneficiaries on a pair of irrevocable SLATs our parents set up for one another. Their goal was to fill each one to the maximum lifetime gift limit ($13.6M or so) and then let those assets grow in an estate tax sheltered fashion. I believe you can even pay taxes on gains made within the trust from money outside the trust.

I’m no expert but something to look into as you can put money away while still having access to it if you need down the line (with some restrictions but you don’t run the risk of giving away too much and going broke)

We have a SLAT. So long as the grantor is alive (my husband), it is a grantor trust, so everything is taxed to him personally. Once he dies, the trust stands on its own. I am the trustee and a beneficiary and can access the money. This all works so long as we stay married.

What happens in a divorce? It gets split 50/50?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you have an irrevocable trust, how did you decide how much to transfer into it? What percentage of your NW did that represent? Thank you.

My siblings and I are beneficiaries on a pair of irrevocable SLATs our parents set up for one another. Their goal was to fill each one to the maximum lifetime gift limit ($13.6M or so) and then let those assets grow in an estate tax sheltered fashion. I believe you can even pay taxes on gains made within the trust from money outside the trust.

I’m no expert but something to look into as you can put money away while still having access to it if you need down the line (with some restrictions but you don’t run the risk of giving away too much and going broke)

We have a SLAT. So long as the grantor is alive (my husband), it is a grantor trust, so everything is taxed to him personally. Once he dies, the trust stands on its own. I am the trustee and a beneficiary and can access the money. This all works so long as we stay married.

What happens in a divorce? It gets split 50/50?

By the sound of it, nope. The assets are in a trust protected from ex-wives and creditors while giving grantor access to the money. Once divorced, the ex-spouse no longer has legal access to the trust. Win-win for the fella!

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Anonymous wrote:

Anonymous wrote:OP here. Current NW is $5MM, but likely to go up to $10MM in a few years. This does not take into account any other appreciation of assets. We’re in our 40s.

No, you should not be putting any assets in an irrevocable trust unless there’s something else major going on and it’s part of a comprehensive estate plan prepared by a reputable professional that you then ran by another reputable professional. I can’t even think of what a that situation would be, I guess maybe non voting shares in a company that’s about to patent alchemy? What you’ve written does not support the idea.

And you certainly wouldn’t put your house in one.

We have about $9M now (late 50s) and likely have $20M by the time we are dust. We are considering setting up an Ir trust so kids get a certain amount each month vs the entire amount. All kids will be past 30 by then, but we are concerned about one that is likely to make bad decisions with the inheritance if they get it in a lump sum. The others don't need the inheritance and receiving the money in one shot vs. as an income stream won't matter to them. Good idea? Bad idea?

I would just use a testamentary trust (one that kicks in by operation of your will after you die). You are still well under the estate tax threshold which is $30 million per couple in 2026 with automatic inflation adjustments.

Or with $9 million you could pay someone for advice too

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you have an irrevocable trust, how did you decide how much to transfer into it? What percentage of your NW did that represent? Thank you.

My siblings and I are beneficiaries on a pair of irrevocable SLATs our parents set up for one another. Their goal was to fill each one to the maximum lifetime gift limit ($13.6M or so) and then let those assets grow in an estate tax sheltered fashion. I believe you can even pay taxes on gains made within the trust from money outside the trust.

I’m no expert but something to look into as you can put money away while still having access to it if you need down the line (with some restrictions but you don’t run the risk of giving away too much and going broke)

We have a SLAT. So long as the grantor is alive (my husband), it is a grantor trust, so everything is taxed to him personally. Once he dies, the trust stands on its own. I am the trustee and a beneficiary and can access the money. This all works so long as we stay married.

What happens in a divorce? It gets split 50/50?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you have an irrevocable trust, how did you decide how much to transfer into it? What percentage of your NW did that represent? Thank you.

My siblings and I are beneficiaries on a pair of irrevocable SLATs our parents set up for one another. Their goal was to fill each one to the maximum lifetime gift limit ($13.6M or so) and then let those assets grow in an estate tax sheltered fashion. I believe you can even pay taxes on gains made within the trust from money outside the trust.

I’m no expert but something to look into as you can put money away while still having access to it if you need down the line (with some restrictions but you don’t run the risk of giving away too much and going broke)

We have a SLAT. So long as the grantor is alive (my husband), it is a grantor trust, so everything is taxed to him personally. Once he dies, the trust stands on its own. I am the trustee and a beneficiary and can access the money. This all works so long as we stay married.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here. Current NW is $5MM, but likely to go up to $10MM in a few years. This does not take into account any other appreciation of assets. We’re in our 40s.

No, you should not be putting any assets in an irrevocable trust unless there’s something else major going on and it’s part of a comprehensive estate plan prepared by a reputable professional that you then ran by another reputable professional. I can’t even think of what a that situation would be, I guess maybe non voting shares in a company that’s about to patent alchemy? What you’ve written does not support the idea.

And you certainly wouldn’t put your house in one.

We have about $9M now (late 50s) and likely have $20M by the time we are dust. We are considering setting up an Ir trust so kids get a certain amount each month vs the entire amount. All kids will be past 30 by then, but we are concerned about one that is likely to make bad decisions with the inheritance if they get it in a lump sum. The others don't need the inheritance and receiving the money in one shot vs. as an income stream won't matter to them. Good idea? Bad idea?

Anonymous wrote:

Anonymous wrote:If you have an irrevocable trust, how did you decide how much to transfer into it? What percentage of your NW did that represent? Thank you.

My siblings and I are beneficiaries on a pair of irrevocable SLATs our parents set up for one another. Their goal was to fill each one to the maximum lifetime gift limit ($13.6M or so) and then let those assets grow in an estate tax sheltered fashion. I believe you can even pay taxes on gains made within the trust from money outside the trust.

I’m no expert but something to look into as you can put money away while still having access to it if you need down the line (with some restrictions but you don’t run the risk of giving away too much and going broke)

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Op,

How much money do you have?
$14m? Then you have enough to talk to an estate attorney.

Actually if it's a couple and they have 2 children, they can each gift up to $13 million to each child before triggering gift/estate taxes. So it would take $52 million to be relevant.

A few states do have estate taxes, though.

Nice try, but you cannot gift $13m to EACH kid.

You are thinking about the yearly gift allowance. Where you can gift $18K to each family member (or anyone) and each spouse can do it. So if you have 2 kids, each are married, then you can gift $36K to each kid and $36K to their spouses. ($144K), And the same $36K to each grandkid

That is what we do already. Simple way to spend down while alive, and let the kids/grandkids use it when it matters most (20/30s for kids and the GK from birth onwards---knowing their 529s will be fully funded for $90K college currently)

PP was correct, except the unified estate/gift exemption amount is $13.61 million in 2024, to be precise. You can gift that much to your children now (per spouse per child). All it would trigger is a filing reporting the gift (no tax) and that amount would be credited to your estate at death. Anything else that you give or bequeath upon death over that amount would be taxed.

It's actually a smart thing to do if you think the exemption amount is going to go down in the future. In the past, the IRS has grandfathered gifts from estates that were under the exemption amount when they were given, even if the exemption amount has subsequently gone down.

But I encourage you to get good legal advice before you do anything. The people who are most confident are usually wrong.

I need to clarify this -- which makes my point about legal advice on this forum. The $13.61 million exemption is *per spouse* (the credit is per person and portable between spouses), but must be divided between the children. So if one spouse predeceases, and the surviving spouse elects to "port" the exemption (you should), the surviving spouse could give $13.61 million to each child.

Assuming you are a lawyer, thanks for sharing. Please note that no one is running away to implement every legal thought they come across here. This is part of their 'research'. Please don't hesitate to share legal advice (or opinions if that will make you rest easy). Most legal questions go unanswered or poorly answered but lawyers don't hesitate to ask financial questions by the hundreds.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Op,

How much money do you have?
$14m? Then you have enough to talk to an estate attorney.

Actually if it's a couple and they have 2 children, they can each gift up to $13 million to each child before triggering gift/estate taxes. So it would take $52 million to be relevant.

A few states do have estate taxes, though.

Nice try, but you cannot gift $13m to EACH kid.

You are thinking about the yearly gift allowance. Where you can gift $18K to each family member (or anyone) and each spouse can do it. So if you have 2 kids, each are married, then you can gift $36K to each kid and $36K to their spouses. ($144K), And the same $36K to each grandkid

That is what we do already. Simple way to spend down while alive, and let the kids/grandkids use it when it matters most (20/30s for kids and the GK from birth onwards---knowing their 529s will be fully funded for $90K college currently)

Anonymous wrote:

Anonymous wrote:OP here. Current NW is $5MM, but likely to go up to $10MM in a few years. This does not take into account any other appreciation of assets. We’re in our 40s.

No, you should not be putting any assets in an irrevocable trust unless there’s something else major going on and it’s part of a comprehensive estate plan prepared by a reputable professional that you then ran by another reputable professional. I can’t even think of what a that situation would be, I guess maybe non voting shares in a company that’s about to patent alchemy? What you’ve written does not support the idea.

And you certainly wouldn’t put your house in one.