The holiday season is here—the time of year when people are happy, warm, and have good times with their loved ones. With the year ending soon, those of us who care for our families and generations are thinking of how we will be remembered. For some, the holiday spirit inspires a truly meaningful gesture: gifting precious family items, property, or any other valuable assets to family members.
Beyond the festive celebrations, the holidays also present a unique opportunity to think about long-term planning. Did you know that Americans spend hundreds—even thousands—of dollars during the holidays? Although it is the best feeling to give gifts, incorporating estate planning into the festive season could be fulfilling and provide direction. The idea of donating large valuable properties now also helps to minimize the amount of estate taxes and at the same time make sure that these assets will be passed to the rightful owners without much trouble and burdening them in the future.
Passing down such treasures is more than a gift; it’s a way of sharing your family’s story, values, and history with future generations. However, the process of transferring these meaningful assets cannot be done based on sentiment alone, but it calls for planning so that everything is done effectively and legally. As we approach the holiday season, Attorney Ben Weaver and the team at 23 Legal are here to assist you in making these gifts as part of your estate plan so that your legacy is safeguarded.
The Meaning Behind Gifting Family Assets During the Holidays
There’s something beautiful about the holiday season—it reminds us of the value of family and the joy of giving. While exchanging presents is a common tradition, gifting significant family assets carries a deeper emotional weight.
Think of the grandmother who gives her wedding ring to her granddaughter or the parents who choose to give their children a vacation house where their memories were made. These are not mere gifts with monetary value; they represent love, tradition, and preservation of family legacy.
However, such meaningful gestures come with legal and financial obligations. Without proper planning, the sentimental act of giving can lead to unforeseen challenges for both the giver and the recipient.
Why Estate Planning Is Essential for Holiday Gifting
Giving family treasures, land, or any other valuable items is not as easy as wrapping them in holiday paper and putting them under the tree. Such gifts may have legal and tax consequences that touch on your estate as well as the beneficiary’s in the future.
Here’s why estate planning should be part of your holiday gifting process:
- Avoid Legal Disputes: Documenting the transfer of assets reduces the risk of misunderstandings or disputes among family members.
- Minimize Tax Liabilities: Some gifts like real estate or substantial cash to a recipient, will be subjected to gift taxes or even the estate tax exclusion. Planning implies that taxes are optimally utilized.
- Ensure Seamless Transfer: If there is no legal paperwork, the transfer process becomes an issue, and the purpose of your gift is not achieved.
- Protect the Recipient: By considering the recipient’s financial or legal circumstances, you can structure your gift in a way that safeguards their interests.
At 23 Legal, we know how valuable such changes are and how these should be made as seamless and effective as possible. Now let’s consider how this can be done during the holiday season.
Best Practices for Gifting Significant Family Assets
Start with an Estate Planning Review
Before you consider giving away large gifts, consult your current estate plan with a knowledgeable attorney. This helps in ensuring that your gifting objectives are lined up to your overall estate planning objectives.
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- Is the gift something that you have to consider in your future budget?
- Will it affect other parts of the estate i.e. the share of other beneficiaries of the estate?
Attorney Ben Weaver can help you evaluate these factors to make informed decisions.
Understand the Tax Implications
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- Gift Tax Exemption: In 2024, the annual gift tax exclusion allows individuals to give up to $17,000 per recipient without incurring federal gift taxes. For married couples, this limit doubles to $34,000.
- Lifetime Exemption: Gifts exceeding the annual limit may count toward your lifetime estate and gift tax exemption, which stands at $12.92 million for individuals and $25.84 million for married couples in 2024.
Knowledge of these thresholds helps to prevent unpleasant surprises when it comes to taxes. An estate planning attorney can assist you in planning to reduce your tax exposure while at the same time increasing the effect of your gift.
Document the Transfer Properly
Whether you are conveying a property deed, appointing an account, or giving an heirloom, it is required that it should be documented. This safeguards your intention as well as makes the recipient’s ownership interest clear.
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- Deeds and Titles: For real estate or vehicles, ensure the transfer is legally recorded.
- Financial Accounts: Joint accounts or to name beneficiaries if necessary.
- Personal Property: Include a detailed description of the heirloom in your estate plan to avoid disputes.
Consider Creating a Trust
For large contributions, a trust may be the answer. Trusts are convenient and give the donor the power to determine how the gift is disbursement and when.
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- Example: If you are giving a financial asset to a young person, you can lay down the rules on how that money is spent (for instance, on education or to purchase a first home).
For example, the establishment of spousal lifetime access trust (SLAT) enables married couples to transfer highly appreciable assets with efficiency in tax while granting the couple very minimal control of the funds during their lifetime.
Communicate Your Intentions
Transparency is key when gifting significant assets. Talk with family members about your plans in order that everyone knows what you are doing and to avoid confusion at a later time.
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- Share the sentimental value of the gift to highlight its importance.
- Address potential concerns about fairness among siblings or other heirs.
Protect Your Own Financial Security
While gifting during the holidays is a generous act, ensuring it doesn’t compromise your financial stability is essential. Work with your attorney to assess your financial situation and determine the best way to structure your gift.
The Role of 23 Legal in Holiday Gifting
At 23 Legal, we specialize in estate planning that reflects your unique values and priorities. We understand that giving large gifts involves more than just a business exchange; it is about providing for your family’s future.
Ben Weaver and his team of attorneys provide professionalism, understanding, and an individualized approach to every estate planning. It may be the passing of a loved family item or the conveyance of a family home, we will guide you through the legal processes.
Add an Estate Plan to Your Wish List This Year!
As this year comes to an end, the holiday season also provides a nice chance to look forward. When you include your holiday gift-giving into your estate plan, you’re not only enjoying the now but also preparing for later.
Can you picture yourself going into the New Year knowing that your family’s most prized possessions are secure and transferred according to your wishes?
Partner with 23 Legal for Expert Guidance with Estate Planning & Asset Transfer
As you gather with loved ones this holiday season, think about the gift of planning for the future. Giving the family assets as gifts is not something that has to be complicated. If you take the right legal advice and plan your estate properly, your gifts will be received in the right spirit as you intended.
This holiday season, let your family receive the best present ever; security, love, and a lasting legacy. Call attorney Ben Weaver and the team at 23 Legal now to begin organizing. Let us assist you in making the season magical, meaningful, and legally smooth.
Wishing you and your family a joyful holiday season and a prosperous new year from all of us at 23 Legal!
Why Choose 23 Legal
23 Legal offers Real Estate and Estate Planning legal services to individuals, families, community associations and small business owners throughout Chicagoland. We know how intimidating “the law” can be. In fact, when most people think of law offices, they think of stuffy leather chairs, huge wooden desks and pompous lawyers who charge outrageous fees. That’s not us! We believe in 1-to-1; the same lawyer should work with you all the way through. Whether you have an estate planning issue, family trust concern, or you have a legal problem in regard to a new home, business, real estate or remodel, you need a lawyer who cares. That’s where Ben comes in! We are great listeners; more than that, we are lawyers who believe that our clients always come first.
