Estate Planning
11/18/2017
Hi Harold and Harriet,
I hope you found the meeting with the attorney helpful. I have composed some advantages or tax
implications to consider in the following assets for your consideration.
• Pay tuition for their 2 college aged children, Henry and Hope – This strategy is worth pursuing to
reduce the gross estate given unlimited gift tax exclusion for payments of tuition made directly to an
educational institution on behalf of a student.
• Set up a Qualified Personal Residence Trust – A qualified personal residence trust, or QPRT, is a specific
type of irrevocable trust designed to reduce one’s taxable estate to avoid estate and gift taxes. They
can also be used for asset protection purposes. QRPTs are intended to hold your home (residence or
vacation home) for the benefit of your children. Here’s how they work: when you put your home into
a QPRT, you lose ownership of it but retain the right to continue living in the house for a specified
amount of time. After that amount of time passes, the property is controlled by the named
beneficiaries. You can remain living in the home, but would have to pay fair market rent. As
mentioned, QPRTs are used primarily as a way to reduce estate and gift taxes. When you put your
home into the trust, the home is taken out of your estate. So, your taxable estate will be reduced by
the value of the house.
• Make annual gifts to their 2 children – You can also take advantage of annual gift exemptions by gifting
