Many people think estate planning is only about deciding who inherits their property, but it also plays a powerful role in protecting wealth from unnecessary taxes. Without a thoughtful plan, a significant portion of your estate can be lost to federal and state taxes, leaving less for your loved ones or charitable causes. By using proven strategies, our Great Falls, MT estate planning lawyer can help you keep more of your hard-earned assets where you want them to go.
Understanding The Tax Landscape
Estate taxes are levied on the value of a person’s property after death. While federal estate tax exemptions are relatively high—over $13 million per individual in 2025—states may impose their own estate or inheritance taxes with much lower thresholds. Large estates aren’t the only concern: capital gains taxes can also affect heirs if assets are sold, and income taxes apply to certain retirement accounts. Proper planning addresses all these potential liabilities.
The Power Of Lifetime Gifting
One of the simplest ways to reduce future estate taxes is to give assets away during your lifetime. The IRS allows an annual gift tax exclusion—currently $18,000 per recipient (2025)—which means you can give this amount to as many individuals as you like each year without incurring taxes. Over time, these gifts lower the taxable value of your estate while helping family members or charities right now.
Larger gifts may also be possible using a portion of your lifetime estate and gift tax exemption. Our estate planning lawyer can help structure these transfers to avoid triggering unexpected tax bills.
Creating Trusts To Shield Assets
Trusts are powerful tools for minimizing taxes and ensuring assets pass smoothly to beneficiaries. Options include:
Revocable Living Trusts: These help avoid probate, which saves time and court costs, though they don’t reduce estate taxes directly.
Irrevocable Trusts: By transferring property into an irrevocable trust, you effectively remove those assets from your taxable estate.
Charitable Remainder Trusts or Charitable Lead Trusts: These provide income to your beneficiaries or to a charity for a set period, offering both tax deductions and philanthropic impact.
Each trust type has unique rules and benefits. Our skilled estate planning lawyer will tailor the structure to your goals, whether that’s providing for minor children, supporting a charity, or protecting a family business.
Leveraging Marital Deductions And Portability
For married couples, the unlimited marital deduction allows you to leave any amount of assets to your spouse free of federal estate taxes. Additionally, portability rules let a surviving spouse use any unused portion of the deceased spouse’s federal exemption. This effectively doubles the amount that can pass tax-free if both spouses’ plans are coordinated.
Reducing Income And Capital Gains Taxes
Estate planning can also minimize taxes beyond the estate tax itself. Designating beneficiaries for retirement accounts like IRAs or 401(k)s can help stretch distributions and reduce income taxes for heirs. Strategically transferring appreciated assets allows beneficiaries to benefit from a “step-up in basis,” reducing capital gains if they sell those assets.
By combining timely gifts, well-structured trusts, and careful beneficiary designations, you can preserve wealth, reduce taxes, and provide lasting security for the people and causes you care about most. Thoughtful planning today means your legacy will be measured by the lives you touch—not by taxes paid tomorrow. At Silverman Law Office, PLLC, we are here to help you.