Heads you win, tails you win

This calendar year may provide a watershed opportunity for those families looking to take advantage of the considerable, but temporary, wealth transfer exemption rules. Most families are not opposed to saving death taxes by transferring appreciating assets out of their estates but don’t necessarily believe the law will change for the worst.

Under current tax law, the lifetime gift and estate tax exclusion a taxpayer may gift tax-free, or bequeath to an estate, is currently $11.580M*.  If the other party wins the Whitehouse and Congress, they have suggested they will repeal the favorable tax laws and replace them with laws that provide a considerably more modest exemption and higher tax rates at death.

Meet the HUWTUW Trust℠, which is pronounced ‘Hootoo’ and stands for “Heads You Win, Tails You Win”, as the answer to those who want to hedge their bet. Say you want to protect part of your nest egg against future unknown creditors and predators but you live in a state which laws do not favor asset protection planning. Establish a HUWTUW Trust in one of the asset protection states. As the grantor or creator, you can fund the trust with your assets for the benefit of your then spouse at a time when you have no known, foreseeable or expected creditor claims. Should the “what if” happen post trust formation and you are not able to access the trust’s assets due to a nasty judgment creditor, the trustee may pay for the benefit of your then spouse and allow the continuation of the family’s “lifestyle.” That last thing you want to do is come home and tell your spouse and family you have been sued and could lose everything you have own. The HUWTUW trust will prevent that from happening if established at the proper time.

Trusts can be complicated but we simplify the complex.

Please contact us to explore your options for creating a custom HUWTUW Trust for your family while keeping things simple.

* For the tax year 2020 and such amount is indexed for inflation