Jim McCullar of Ephrata, Washington, the man who bought one of the two winning tickets in the $380-million Mega Millions lottery claimed his half of the multi-state lotto jackpot on January 6, 2011. Jim McCullar accepted his $190 Million check and handed it to his wife Carolyn. The couple has not decided whether they will take a lump sum or annual installments but they said that they have no plans to “blow” the money. Jim McCullar told the media he plans for the legacy to go to generation after generation after generation, so that his kids, grandkids, and great grandkids and their kids will never have to worry. Full article: ABC News.
The Government’s estate tax is designed to tax assets when they are passed from one generation to another, such as a parent to a child. For individuals that have a large estate, paying taxes at each generation can be extremely costly and often times can deplete an estate. A solution is to establish a Generation Skipping Trust. This type of trust effectively transfers assets from the grantor’s estate to his or her grandchildren, the children of the grantor never take title to the assets. This allows the grantor to avoid the estate taxes that would apply if the assets were transferred to his or her children first. Generation skipping trusts can still be used to provide some financial benefits to a grantor’s children, however, because any income generated by the trust’s assets can be made accessible to the grantor’s children while still leaving the assets in trust for his or her grandchildren.
The attorneys at Leeds, Morelli & Brown, P.C. have worked with a variety of families in Nassau and Suffolk counties, Manhattan, Queens, Brooklyn, Bronx, and Staten Island. For questions regarding estate planning, please contact an attorney at the Leeds Morelli & Brown P.C. law firm for a free consultation at 1-888-556-2529 or visit the firm’s website at www.lbestatelaw.com.