Can I Reduce My Estate Taxes by Paying for Education Now?

December 16, 2020

If you are looking ahead to your future estate taxes and looking for a strategy to minimize them, a consultation with an estate planning lawyer can help you to address many of the most common issues and concerns that come up in connection to this.

Savvy planning can make things easier for your loved ones in the short term but also can benefit you in the long term. Paying tuition or medical bills doesn’t count towards your annual exclusion or the estate tax exemption so long as the checks are written directly to the school or health care provider. This can help to reduce the size of your taxable estate and can help provide a valuable gift to your loved ones who may need the money for their education or their expenses.

Many people are currently reevaluating their charitable contributions and gifting to grandchildren to determine if the strategies they had in place prior to the pandemic are sustainable. If you make any short term changes that reduce your gifting strategy, you’ll still want to have a plan for revisiting these in future times to ensure that they align with what you intend to accomplish with your family.

During these uncertain times when there are many possible changes with estate laws in the works and a great deal of unknowns as it relates to the pandemic, it’s important to have relationships with trusted professionals like estate planning lawyers to allow yourself to make informed decisions as needed.


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