top of page
Search

Advanced Estate Planning Tax Strategies for High-Net-Worth Individuals

  • Parkview Partners Capital Management
  • 3 days ago
  • 3 min read

Strategic Planning for Wealth Transfer


High-net-worth individuals often face complex considerations when preparing to transfer wealth across generations. Estate planning involves more than document preparation; it requires an understanding of tax structures, long-term goals, and the coordination of multiple professional advisors. A thoughtful strategy may help reduce potential tax exposure while preserving flexibility and clarity for beneficiaries.


This guide outlines several established estate planning techniques. Each strategy involves legal and tax considerations that depend on individual circumstances, making professional guidance essential.


Grantor Retained Annuity Trust (GRAT)


A Grantor Retained Annuity Trust (GRAT) is designed to transfer potential asset appreciation to beneficiaries with limited gift tax impact. The grantor contributes assets to an irrevocable trust and receives an annuity payment for a designated term. Any remaining value at the end of the term passes to beneficiaries.


Key considerations include:


  • Asset Selection: Assets with higher appreciation potential may be more effective.

  • Term Length: Longer terms may involve longevity risks for the grantor.

  • Interest Rate Environment: GRATs are generally more favorable when IRS Section 7520 rates are low.

  • Zeroed-Out Structure: Often used to mitigate the taxable gift amount.


Intentionally Defective Grantor Trust (IDGT)


An Intentionally Defective Grantor Trust (IDGT) is structured so that trust assets are outside the taxable estate while the grantor remains responsible for income taxes generated by the trust. This structure can support long-term asset growth potential within the trust.


Common implementation factors include:


  • Asset Sale vs. Gift: Many IDGTs involve selling appreciating assets to the trust.

  • Income Tax Payments: The grantor must be prepared to cover trust-related income taxes.

  • Initial Funding: Trusts are often seeded with an initial gift to support the structure.

  • Valuation: Professional valuations may be required for illiquid assets.


Spousal Lifetime Access Trust (SLAT)


A Spousal Lifetime Access Trust (SLAT) allows one spouse to transfer assets into an irrevocable trust for the benefit of the other spouse while removing those assets from the taxable estate. This approach can provide indirect access to the transferred assets while advancing long-term estate planning goals.


Important considerations include:


  • Separate Property Requirements

  • Avoiding Reciprocal Trust Issues

  • Trustee Selection

  • Potential Loss of Access in Certain Circumstances


Irrevocable Life Insurance Trust (ILIT)


An Irrevocable Life Insurance Trust (ILIT) can help ensure life insurance proceeds remain outside the taxable estate. The trust owns the policy, and the trustee manages premium payments and distributions.


Key elements include:


  • Crummey Powers: Allow beneficiaries temporary withdrawal rights to qualify gifts for the annual exclusion.

  • Three-Year Look-Back Rule: Applies when transferring an existing policy to the trust.

  • Irrevocability: Terms generally cannot be changed once established.

  • Trustee Duties: Include premium management and beneficiary notifications.


Integrating Multiple Strategies


Estate planning strategies are often most effective when implemented together. For example, an ILIT may provide liquidity to support tax obligations, while a GRAT or IDGT may assist in transferring appreciation outside the taxable estate. Coordinating these tools requires alignment with long-term goals, risk tolerance, and family circumstances.


Conclusion


Advanced estate planning involves balancing control, tax considerations, and the long-term transfer of wealth. Approaches such as GRATs, IDGTs, SLATs, and ILITs each serve distinct purposes within a broader framework. Working alongside qualified legal, financial, and tax professionals can help ensure that estate strategies reflect individual goals and support long-term family planning.



Investment advice offered through Stratos Wealth Partners, Ltd., a registered investment advisor. Stratos Wealth Partners, Ltd and Parkview Partners Capital Management are separate entities. Neither Stratos nor Parkview Partners Capital Management provides legal or tax advice. Please consult legal or tax professionals for specific information regarding your individual situation. Investing involves risk, including possible loss of principal. The information presented is for educational purposes only and should not be interpreted as individualized investment, tax, or legal advice. Past performance is not indicative of future results. For more information, please review our Form ADV, available upon request.


 
 
 

Comments

Financial Advisor, Investment Advisor, High Net Worth, Wealth Management, Tax Planning, Risk Management, Financial Coordination, Retirement Planning, Charitable Giving, Columbus Ohio, Parkview Partners Capital Management

291 East Livingston Ave.
Columbus, OH 43215


Phone: (614) 427-2132

Fax: (614) 427-2132

  • LinkedIn

FORM CRS

 

Privacy Policy

​

​

Investment advisory services are offered through Stratos Wealth Partners, Ltd., a Registered Investment Advisor located in Beachwood, Ohio. [www.stratoswealthpartners.com]. 

Parkview Partners Capital Management offers its financial services through Stratos Wealth Partners, Ltd., (“Stratos”), a Registered Investment Advisor with the U.S. Securities and Exchange Commission (the “SEC”) located in Beachwood, Ohio. Parkview Partners Capital Management  operates as a DBA branch of Stratos Wealth Partners, Ltd. More information regarding Stratos may be found at www.stratoswealthpartners.com. Registration with the SEC does not imply a certain level of skill or training. Public information concerning Stratos Wealth Partners is available at https://www.adviserinfo.sec.gov. A copy of the Stratos’ current written disclosure Brochure discussing our advisory services and fees continues to remain available upon request and/or on this web site at www.stratoswealthpartners.com.

​

Stratos may only transact business in those states in which it is registered or qualifies for an exemption or exclusion from registration requirements. Stratos’ web site is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of Stratos’s web site on the Internet should not be construed by any consumer and/or prospective client as Stratos’ solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet. Any subsequent, direct communication by Stratos with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. A copy of Stratos’ current written disclosure Brochure discussing Stratos business operations, services, and fees is available from Stratos upon written request. Stratos does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third-party, whether linked to Stratos’ web site or incorporated herein, and takes no responsibility therefore. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.
 
Information presented on this site is for informational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any product or security. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed here. When you link to any of the websites provided here, you are leaving this website. The information and opinions contained in any of the material requested from this website are provided by third-parties as well. They are for informational purposes only and are not a solicitation to buy or sell any product mentioned. We make no representation as to the completeness or accuracy of the information provided by these third-party websites or third- party materials.

 

Please remember that different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment or investment strategy (including those undertaken or recommended by Stratos Wealth Partners, LTD), will be profitable or equal any historical performance level(s).
 
Certain portions of Stratos’ web site (i.e. newsletters, articles, commentaries, etc.) may contain a discussion of, and/or provide access to, Stratos (and those of other investment and non-investment professionals) positions and/or recommendations as of a specific prior date. Due to various factors, including changing market conditions, such discussion may no longer be reflective of current position(s) and/or recommendation(s). Moreover, no client or prospective client should assume that any such discussion serves as the receipt of, or a substitute for, personalized advice from Stratos, or from any other investment professional. Stratos Wealth Partners, LTD is neither an attorney nor an accountant, and no portion of the web site content should be interpreted as legal, accounting or tax advice.

Each client and prospective client agree, as a condition precedent to his/her/its access to Stratos’ web site, to release and hold harmless Stratos, its officers, directors, owners, employees and agents from any and all adverse consequences resulting from any of his/her/its actions and/or omissions which are independent of his/her/its receipt of personalized individual advice from Stratos.

bottom of page