\u201cIt\u2019s a strategic game of chess played over decades,\u201d says Mark Bosler, an estate planning attorney in Troy, Michigan, and legal adviser to Real Estate Bees. \u201cWhile the average person relies on a simple will, the well-to-do utilize a different playbook.\u201d<\/p>\n
Consider a trust<\/p>\n
First, consider the facts: Despite widespread misconceptions, only estates of the very richest Americans are generally subject to taxes. At the federal level<\/a>, estates of over $15 million typically trigger taxes. At the state level, 16 states and the District of Columbia do collect estate or inheritance taxes, according to the Tax Foundation, sometimes with lower exemptions than the IRS, but still at thresholds targeting millionaires.<\/p>\n While most people can pass on what they have without worrying about their heirs being caught in a web of taxes, it can require planning to escape a messy process<\/a> that can hold up estates for years and cost families significantly<\/a> in court fees and lawyer bills.<\/p>\n The solution at the center of many estate planners\u2019 designs is a trust.<\/p>\n Though trusts conjure images of complex arrangements<\/a> utilized by the uber-rich, they are relatively simple tools that can make sense for many people. They come with expense, often costing thousands of dollars in lawyer fees to set them up. But for a retired couple with a paid-off house, 401(k)s and a portfolio of investments, they can ease the passing of assets<\/a> to heirs.<\/p>\n Among the reasons: Even if you aren\u2019t leaving enough behind to trigger taxes, your estate can get tied up in probate court, which typically assesses fees based on an estate\u2019s total value.<\/p>\n \u201cYou are leaving what might have gone to your children or other loved ones to attorneys and the courts,\u201d says Renee Fry, CEO of Gentreo, an online estate planner based in Quincy, Massachusetts. \u201cAnywhere from 3 to 8% of an estate might be lost.\u201d<\/p>\n Trusts can allow an estate to sidestep court altogether and to shield it from public view<\/a> by keeping details out of public records. Some people also use them to protect their savings if they someday need nursing home care and would prefer to qualify for a government-paid stay under Medicaid instead of paying themselves.<\/p>\n Imagine being an investor in a stock like Nvidia that has soared in recent years. Now imagine being able to reap the profit of selling your shares without paying tax.<\/p>\n It\u2019s possible with one caveat: You have to die.<\/p>\n![\"FILE](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/Be_Well-Estate_Planning_41714.jpg\")
FILE \u2013 The likeness of Benjamin Franklin is seen on U.S. $100 bills, Thursday, July 14, 2022, in Marple Township, Pa. (AP Photo\/Matt Slocum, File)
\nPass on stocks virtually tax-free<\/p>\n