Managing Risks Gifting and Legacy Planning

Key Takeaways

• Use the $15,000 annual gift exclusion per person ($30,000 for married couples) to transfer wealth tax-free; this resets each year and is separate from other giving strategies
• Pay tuition and qualified medical expenses directly to institutions to avoid counting toward annual gift limits—enabling you to give additional amounts beyond the $15,000/$30,000 annual exclusion
• Have parents purchase long-term care insurance on adult children as the insured while the parent owns and pays premiums—this allows an additional $15,000/$30,000 annual gift to the child without triggering gift taxes
• Shift your risk management strategy based on life stage: prioritize life and disability insurance during earning years to protect income, then transition focus to long-term care planning as you approach retirement
• Consult your CPA and insurance agent to verify policy structure and ownership rules are correct before implementing wealth transfer strategies to ensure the gift tax exemptions actually apply