${site.data.firmName}${SEMFirmNameAlt}
Throughout Southern California
310-324-9403
Toll-Free
866-402-1805
View Our Practice Areas

Give Money Now - Or Later?

For those who are fortunate to enjoy their retirement and have enough money to leave behind, they might be wondering whether it is best to leave an inheritance or gift their assets? Although the percentage of taxes owed on gifts and inheritance is the same, one is inclusive and one is exclusive, and the dollar difference between the two is huge.

One important aspect to the decision is the potential tax consequences.

This is why some people struggle over whether they should give money now to family members so they can see the benefits of that money or whether it is a better idea to leave those family members an inheritance. They know there are different tax rules depending on giving now or later, but what are those rules?

In neither case will the recipient have to pay taxes on the money. Nevertheless, as the Wills, Trusts & Estates Prof Blog explained, in a recent article titled "To Gift or Bequeath? That is the Question," the recipient might receive more money if you give it to them now.

As the article explains, if you are in the 40% tax bracket and give someone $1 million today, you will be required to pay $400,000 in taxes on the gift. However, if you have precisely $1.4 million and leave it all to someone in an inheritance, then the entire amount would be taxed at 40%.

That would make the actual amount inherited $850,000, not the $1 million that could be gifted with the exact same amount of money.

Of course, it is not quite as simple as that and you should speak with an estate planning attorney before reaching a decision whether to gift now or leave an inheritance.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Find Out The Difference That Experience And Expertise Makes

Get the peace of mind that you deserve. First, attend a seminar. This will entitle you to a free initial consultation and a discounted estate planning fee. To learn more about our services or sign up for a seminar, contact us online or call us at 866-402-1805. We have offices in Torrance, Orange, Newport Beach, Pasadena and Woodland Hills.

Questions? Contact Us.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Call Now For A Free Consultation: 866-402-1805
  • ${site.data.firmName}${SEMFirmNameAlt}
  • Main Office: Torrance

    Torrance Office
    990 West 190th Street
    Suite 500
    Torrance, CA 90502

    Toll Free: 866-402-1805
    Map & Directions

    Orange Office
    333 City Boulevard West
    17th Floor
    Orange, CA 92660

    Toll Free: 866-402-1805
    Map & Directions

    Newport Beach Office
    5000 Birch Street
    Suite 8000
    Newport Beach, CA 92660

    Toll Free: 866-402-1805
    Map & Directions

    Pasadena Office
    790 East Colorado Boulevard
    9th Floor
    Pasadena, CA 91101

    Toll Free: 866-402-1805
    Map & Directions

    Woodland Hills Office
    5850 Canoga Avenue
    4th Floor
    Woodland Hills, CA 91367

    Toll Free: 866-402-1805
    Map & Directions

    Office map
Check out The Law Firm of Kavesh, Minor & Otis on Yelp
Check out Kavesh Minor & Otis on Yelp
Check out The Law Firm of Kavesh, Minor & Otis - Orange on Yelp
Check out The Law Firm of Kavesh Minor & Otis - Pasadena on Yelp