Navigating High-Net-Worth Estates

We've often discussed typical estate planning, but what happens when an estate is more substantial? These are known as high-net-worth estates. In this episode, we'll delve into what constitutes such an estate, what they might entail, the inherent risks without proper planning, and real-life examples to illustrate these points.

Let's begin with a clear definition. A "high-net-worth estate" isn't just about lavish lifestyles; it's about the total value of your assets. If your combined real estate, investments, retirement accounts, and other holdings exceed $1 million, you likely fall into the high-net-worth category and should pay particular attention to tax implications and exemptions.

It's crucial to be aware of the federal estate tax exemption. In 2025, this stands at $13.99 million per individual or $27.98 million for married couples. However, these figures are slated to "sunset" or expire at the end of the year, potentially reverting to 2018 levels around $6 million. This change could impact a wider range of estates. If your estate's total value surpasses this exemption, the amount above the threshold could be subject to a federal estate tax of up to 40%.

State-level regulations are also significant. Here in Tennessee, we currently don't have an inheritance tax, making it an attractive location for retirement. Previously, Tennessee had a $1 million threshold for state estate tax.

Important Note on Income Tax: Any income generated by the estate during its administration is subject to income tax.

Now that we've defined high-net-worth estates, let's explore common pitfalls when these estates are not properly planned, and how to prevent them in Episode 72 of Boomer Time.

🔑 For help, visit https://www.NancyCogar.com🎙️ Listen to the Boomer Time with Nancy Cogar podcast on Spotify, Apple Podcasts, iHeartRadio and on YouTube🎙Listen to Boomer Time with Nancy Cogar on Spotify: ⁠https://open.spotify.com/show/0fxgUg1FwgfazDEDWnqnoS⁠🎙Listen to Boomer Time with Nancy Cogar on Apple Podcasts: ⁠https://podcasts.apple.com/us/podcast/boomer-time-with-nancy-cogar/id1725555845⁠🎙Listen to Boomer Time with Nancy Cogar on iHeartRadio: ⁠https://www.iheart.com/podcast/269-boomer-time-with-nancy-cog-272050488/⁠✨Follow on Instagram: ⁠https://www.instagram.com/nancy.cogar⁠

Disclaimer: The information provided on this website and on the podcast is not intended to be considered as legal advice or constitute an attorney/client relationship as provided under the Tennessee Rules of Professional Conduct.