The Fine Art Of Planning For Collectibles
Do you have an eye for works of art, rare coins, antiques, or other items? We’ve become a nation of collectors. And this passion is especially pronounced among high net worth families. To make the most of collectibles as financial assets, follow these four steps.
1. Take inventory. Figure out what you have and what it’s worth. Record the cost basis of each piece and its current value.
2. Review insurance coverage. Collections are often underinsured, exposing owners to unnecessary risks.
3. Specify assets to be sold when you die. What items would you permit your estate to sell, and which family heirlooms would you like to be given to specified beneficiaries?
4. Focus on financial goals. What are your ultimate objectives with respect to your collection? The following trusts may be used to minimize potential estate and gift taxes:
- Intentionally defective trust (IDT). You transfer the collection into the trust, but intentionally violate the rules for grantor trusts so that income from the trust is taxed to you, not the trust.
- Charitable remainder trust (CRT). A CRT provides income to your designated beneficiaries until the end of a specified trust term, after which the assets go to the charity.
- Charitable lead trust (CLT). The charity receives income during the trust period; then your collection reverts to your beneficiaries.
Could any of these techniques help you make the most of your collection? We can work with you to explore your options.
© 2019. All Rights Reserved.
- IRS Mercy On 60-Day IRA Rollover Error
- Feds Warn Of Life Settlement Dangers
- Do You Have An Administrative Trustee?
- ETFs Offer Alternative Investment Options
- Grantor Annuity Trusts Remain Viable
- 3 Reasons ETFs Are Now Basic To Many Portfolios
- What Do You Want Your Legacy To Be?
- Filtering Alternative Investment Hype
- Bulletproofing Your Will Before Death
- Creating A Financial Independence Plan
- Should You Give Gift Cards? They May Not Be Used
- Website Matches Volunteers With Nonprofits In Need
- 5 Tips For Vacation Home Buyers
- How To Pick A Successor To Run Your Company
- Paying Estate Taxes Over 14 Years