Estate Planning and Taxes: Keeping More for Your Family

Aug 18

When most people hear “estate planning,” they think of the wealthy trying to avoid estate taxes. The truth is, estate planning helps families of all sizes — especially when it comes to reducing everyday taxes. With the right plan, you can pass on more of what you’ve worked hard for and avoid unnecessary costs.

Reducing Income Taxes with Trusts

Certain trusts, like Irrevocable Life Insurance Trusts (ILITs) or Charitable Trusts, can be set up so income is shifted or reduced.
Example: Instead of receiving investment income that bumps you into a higher bracket, you can move those assets into a trust and lower your taxable income.

Avoiding Capital Gains Pitfalls

Beneficiaries usually get a “step-up in basis” when they inherit appreciated property.
Example: If you bought stock at $10,000 and it’s worth $50,000 when you pass, your children can sell it without paying capital gains on that $40,000 increase. A poor plan could cost them thousands.

Protecting Property from Tax Reassessment

Transferring a home without a plan may trigger a reassessment, raising property taxes overnight.
Example: A properly drafted trust can allow your kids to inherit your home without a sudden tax hike.

State and Local Tax Savings

High-tax states like New York impose additional burdens that good planning can reduce.
Example: Certain trusts or relocation strategies can shift taxable income to jurisdictions with lower tax exposure.

Using Gifting to Lower Taxes

You can give up to $18,000 per person per year without triggering gift tax.
Example: A couple with three kids could move $54,000 out of their estate in one year — reducing future taxes while helping family now.

✅ The Bottom Line
Estate planning isn’t just about dividing assets — it’s a smart way to reduce income, property, and capital gains taxes. Even modest estates benefit when families plan ahead.

At Moskowitz Legal Group, we help you keep more in your family’s hands — not the IRS’s.

📞 Contact us at 212-419-0118 today for a free consultation.

Jonah Gorenstein