Estate tax planning isn’t just about preserving wealth. It’s about ensuring your hard-earned assets are protected and transferred efficiently to future generations while minimizing financial burdens.
From mitigating significant tax liabilities to simplifying the distribution process, effective estate tax planning can protect your loved ones from unnecessary complications and tax consequences. Whether your goals are to reduce estate taxes, address potential income or capital gains taxes, or to provide financial security for your heirs, estate tax planning is an essential part of leaving a meaningful legacy.
At Melone Hatley, P.C., our experienced team of Virginia Beach, Virginia trusts and estates attorneys are here with practical steps and key strategies to help protect your assets, provide for future generations, and offer peace of mind.
What Are Estate Taxes?
Estate taxes are taxes levied against property and assets transferred at the time of an individual’s death, including real estate, retirement accounts, investments, personal property, and business interests. The federal government, as well as some states, imposes estate taxes, typically calculated as a percentage of the total value of the decedent’s assets, minus certain deductions and exemptions.
Federal Estate Taxes
Most notably, federal estate taxes are charged to the decedent’s estate before assets are passed on to beneficiaries. Since 2017, taxpayers have benefited from historically high gift and estate tax exemptions under the Tax Cuts and Jobs Act of 2017. In 2025, estate taxes only apply to estates worth more than $13.99 million or individuals, minus applicable gifts and deductions. Because of this, a small percentage of estates trigger Federal estate tax. But for those that do, estate taxes will significantly affect assets available to your beneficiaries, with taxes ranging from 18% to 40% on amounts exceeding the exemption, depending on the size of your estate.
Furthermore, the Tax Cuts and Jobs Act of 2017 is scheduled to “sunset” on December 31, 2025. This could result in an exemption that is nearly half of what it is today. Consequently, planning for federal estate taxes will be critical if you believe your estate may trigger them.
State Estate and Inheritance Taxes
Some states impose additional estate taxes, usually with lower exemption thresholds. However, these are typically paid by the beneficiaries rather than the estate. They can also vary based on an heir’s relationship to the decedent.
While there is no state estate or inheritance tax in Virginia, your beneficiaries may still be subject to state estate taxes if you own property or other assets in states that do have them. Your beneficiaries may also be subject to income or capital gains taxes on inherited assets, including:
- Federal income taxes on withdrawals from inherited IRAs or 401(k)s
- Tax consequences for non-spousal beneficiaries who do not withdraw the balance of inherited retirement accounts within ten years under the SECURE (Setting Every Community Up for Retirement Enhancement) Act
- Capital gains taxes on inherited real estate or securities when they are sold
- Possible property tax reassessments that may increase the beneficiary’s tax burden
- Probate taxes for assets that must go through the probate process
- Income taxes on inherited income-producing properties or businesses
While many of these are unavoidable tax situations for beneficiaries, you will want to minimize tax burdens for your loved ones as much as possible through appropriate estate tax planning.
The Importance of Proper Estate Tax Planning
While federal estate taxes may have no immediate significance for you or your heirs, exemption limits may rest in a little over a year. Even if your estate is never subject to federal estate taxes, there may be other tax considerations you will want to address. Without appropriate planning, taxes can significantly reduce the assets you pass on to your heirs.
Depending on your financial circumstances, effective tax planning can
- Shield your assets from federal and state estate taxes
- Preserve your wealth, ensuring more assets go to your beneficiaries by minimizing the amount paid in taxes
- Clearly outline how your assets will be distributed, reducing family conflict
- Support your charitable giving goals using tax-efficient strategies
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Consider other tax liabilities such as income taxes, capital gains taxes, property taxes, or estate income taxes
that can be unexpected financial burdens and reduce the assets available to your heirs
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What Are Common Strategies Used in Estate Tax Planning?
Unfortunately, without proper estate tax planning, your beneficiaries could be caught off-guard with unintended tax liabilities that could quickly drain their inheritance. With experienced legal estate tax planning assistance, you can protect your assets, ensuring as much of your estate as possible passes safely to your loved ones.
At Melone Hatley, P.C., our highly skilled Virginia Beach, Virginia estate tax attorneys can help protect your estate through a variety of strategies. These include
- Correctly valuing your estate, assessing and calculating the total value of your estate, including all real estate holdings, retirement accounts, investment accounts, business interests, life insurance policies, and personal property
- Helping a surviving spouse claim an unused portion of their deceased spouse’s federal estate tax exemption through portability
- Retitling property jointly to provide easier transfer of ownership
- Establishing trusts that can shelter assets from taxes, provide liquidity, and protect beneficiaries’ interests
- Helping individuals make lifetime gifts to help reduce the taxable estate over time
- Leveraging Family Limited Partnerships (FLPs) to transfer business interests to family members while maintaining control, thereby reducing the taxable value of the transfer
- Setting up charitable donations during your lifetime or through your estate to reduce taxable assets and align with philanthropic goals
- Establishing a business succession plan to minimize taxes and ensure the continuity of your business
- Addressing tax advantages for assets left to grandchildren through a Generation-Skipping Transfer exemption
- Transferring assets to a surviving spouse up to $13 million, exempting them from federal estate taxes
Why Consulting With a Virginia Beach, Virginia Estate Tax Planning Attorney is Essential to Protect Your Assets
Any comprehensive estate plan should consider all possible tax consequences for the future of your estate and your beneficiaries. However, estate tax matters can be very complex. Consulting with an experienced estate tax planning attorney will be vital to minimizing tax liabilities for your estate and beneficiaries and tailoring strategies that consider your specific financial circumstances.
At Melone Hatley, P.C., our experienced Virginia Beach, Virginia estate tax attorneys are experienced in handling all aspects of estate tax matters and estate planning, including tax disputes, tax audits, and other estate planning tax issues. We work diligently to ensure your estate passes safely to your beneficiaries with as few tax consequences as possible. If you need solid legal advice regarding your estate or any potential tax implications, schedule a no-cost consultation with one of our client services coordinators by calling us at (757) 720-7602 or reaching out through our website contact form.
