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Estate Planning for the Other 99.9%

  • Oppenheimer & Co. Inc.
  • November 21, 2019

An estate plan is essential to every financial strategy. It can help leave a larger legacy, potentially reduce transfer taxes and possibly avoid disinheritance. The estate tax and planning landscape today is very different then it was not too long ago. Both the American Tax Payer Relief Act of 2012 (ATRA) and The Tax Cuts and Jobs Act of 2017 (TCJA) altered the estate planning environment through their adjustments to the income tax regime, federal estate and gift taxes.

estate plan

Prior to ATRA, the federal estate tax exemption amount ranged from $600,000 (single person, double if married) in the 1980’s to $3.5 million (single person, double if married) in 2009. When ATRA was passed in 2013, the federal estate tax exemption amount increased to $5 million per person (indexed for inflation.) The maximum estate, gift and generation skipping transfer tax (GST Tax) was set to 40%. In 2017, when the TCJA was passed, the federal estate, gift and GST tax exemption increased to $10 million per person (adjusted for inflation.) The maximum estate, gift and GST tax rates remained at 40%.

So, what does this mean for most Americans? Anyone with an estate below the exemption amounts, or a married couple with an estate that falls below the exemption amounts multiplied by 2, is not subject to the federal estate tax. Do keep in mind that TCJA is scheduled to sunset in 2026 and the tax exemption amounts are set to revert to $5 million per person (indexed for inflation).

Even though the federal estate tax exemptions are currently not a concern for most Americans, there is still planning to be done. Shifting your focus to family dynamics can help determine:

  • How and by whom assets will be managed for your benefit during your lifetime if you ever become unable to manage them
  • When and under what circumstances it makes sense to distribute assets during your lifetime
  • How and to whom assets will be distributed after death
  • How and by whom personal care will be managed and how health care decisions will be made during your lifetime if you become unable to care for yourself
  • How you will minimize family acrimony and manage family dynamics

Other planning areas that may address your needs:

A Special Needs Trust allows a parent, grandparent or guardian to provide funds for a child with a disability without disrupting the child’s eligibility for government aid.

A charity can be the beneficiary of a revocable or irrevocable trust. A Charitable Lead Trust allows you to provide a payout to charities during your lifetime. A Charitable Remainder Trust allows you and/or another beneficiary to receive payments during your lifetime and give a portion of the assets to one or more charities.

A series of logistical and financial decisions about who will take over a business upon retirement, death or disability.

Throughout the various stages of your financial life, it is important to recognize where you stand today, how you can work most effectively toward your objectives and, ultimately, how you can pass on your financial and personal legacy. Your wealth transfer strategy helps you hand over support, assets and even a business to your heirs so they can carry on with the cycle of wealth creation, accumulation and preservation you have established.

In addition to providing security for the people and organizations that mean most to you, the goal of estate planning is to give you the satisfaction of seeing your wishes carried out both wisely and properly. It is potentially one of the most important components of planning you can do.

Through all the changes to the estate tax landscape, the basics of estate planning have been unaffected and still hold true.

You should always include the following:

The primary document used to ensure that property and assets are distributed according to the individual’s wants.

A legal document through which assets are placed into a trust during an individual’s lifetime, then transferred to the designated beneficiaries at their death. It is revocable during the individual’s lifetime.

A power of attorney named that has authority to oversee your medical care and make health care decisions for you if you are unable to do so.

A power of attorney you prepare that gives someone the authority to handle financial transactions on your behalf if you become incapacitated.

You should review and update your estate plan periodically and after any life events such as changes in your family, financial situation, state residence or tax laws to ensure your wishes are being carried out as you see fit.

Contact an Oppenheimer Financial Advisor today to dsicuss your estate planning needs.


Cigler, L. (2019). Estate & Life Insurance Planning for the Other 99%. Webinar, Pacific Life, 12 September 2019.

Ebeling, Ashlea. “IRS Announces Higher 2019 Estate And Gift Tax Limits.” Forbes, Forbes Magazine, 17 Jan. 2019,


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