A: Estate tax planning is the process of arranging your assets and affairs to minimize or eliminate federal and state estate taxes upon your death. Proper planning can preserve more of your wealth for your family and charitable causes. At Boyd & Boyd, P.C., we design customized strategies that align with your financial goals and family legacy.
A: For deaths in 2026, the federal basic estate and gift tax exclusion is $15 million per individual. Prior taxable gifts and any available deceased spouse’s unused exclusion affect an estate’s position. Massachusetts has separate estate tax rules, including a $2 million filing threshold for a resident’s gross estate plus adjusted taxable gifts. A filing requirement does not necessarily mean tax is owed. Review the rules applicable to the date of death and your circumstances.
A: Massachusetts can impose estate tax even when no federal estate tax is due. For deaths on or after January 1, 2023, the law provides a credit of up to $99,600 and no tax when the federal taxable estate, determined under the applicable Massachusetts rules, is $2 million or less. Larger estates require a calculation using the state’s rules; the old description of a tax cliff on the entire estate is misleading. At Boyd & Boyd, P.C., we help clients evaluate their Massachusetts estate tax exposure.
A: Effective estate tax planning may include:
Credit Shelter Trusts (Bypass Trusts)
Lifetime Gifting Strategies
Irrevocable Life Insurance Trusts (ILITs)
Family Limited Partnerships (FLPs) and LLCs
Charitable Planning (Charitable Remainder Trusts, Donor-Advised Funds)
At Boyd & Boyd, P.C., we customize these strategies to fit your unique financial and family goals.
A: The earlier you start, the more options you have. Beginning estate tax planning well before retirement or major asset transfers allows you to take advantage of gifting strategies, trust structures, and valuation discounts. Waiting until later can limit your options and expose your estate to higher taxes. We recommend reviewing your estate plan annually, especially as tax laws and asset values change.
Should Ask Questions (SAQs)
A: Retirement accounts are generally included in the owner’s gross estate for estate tax purposes. Beneficiaries may also owe income tax on taxable retirement-account distributions, while qualified Roth distributions and the return of after-tax contributions can receive different treatment. Estate tax liability depends on the estate, available deductions, and applicable exclusions. Boyd & Boyd, P.C. helps coordinate retirement-account and estate tax planning.
A: Life insurance proceeds can be included in your gross estate if you retain incidents of ownership or the proceeds are payable to or for the benefit of your estate. An Irrevocable Life Insurance Trust (ILIT) may help keep proceeds outside the taxable estate when properly structured and administered, but transferring an existing policy within three years of death can cause inclusion. Trust ownership alone does not guarantee exclusion.
A: A properly made federal portability election can allow a surviving spouse to use a deceased spouse’s unused federal estate tax exclusion. Massachusetts does not provide the same portability benefit. A Credit Shelter Trust may be useful for state-level planning, depending on the family’s circumstances and overall plan. Boyd & Boyd, P.C. helps clients evaluate available exclusions and planning options.
A: Absolutely. Charitable gifts can reduce your estate’s taxable value while supporting causes important to you. Advanced strategies like Charitable Remainder Trusts, Charitable Lead Trusts, and Donor-Advised Funds can provide both lifetime income tax benefits and significant estate tax reductions. Boyd & Boyd, P.C. designs plans to integrate charitable giving with your broader legacy goals.
A: Structuring interests in family businesses, LLCs, or partnerships can qualify for valuation discounts for lack of marketability and lack of control. These discounts lower the appraised value of transferred assets for tax purposes, reducing potential estate or gift taxes. Our team carefully structures ownership to maximize legitimate valuation discounts while preserving family control.
Schedule a confidential consultation with Boyd & Boyd, P.C. to develop a customized estate tax planning strategy designed to preserve more of what you’ve built.
Book Your Estate Tax Planning Consultation or Request Our Free Estate Tax Planning Guide.
1555 Iyannough Road, Unit 1BW · Hyannis, Massachusetts 02601
(508) 444-9688 · plan@boydandboydpc.com