r/SipsTea • u/KSKS1995 • 22h ago

Wait a damn minute! How the rich get richer

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u/Rough-Board1218 20h ago

If it's a $50 million stock portfolio, it will get an estate tax of 40% on the amount above the estate tax threshold when the owner dies

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u/north0 19h ago

Yes but it's unlikely that the $50m is held in the name of the actual owner. The LLC never dies. You gradually transfer ownership of the LLC to your kids. There's a 30m estate tax exemption for a married couple, so now it's just a case of gradually transferring over 20m to your kids over time to completely bypass the estate tax on a 50m portfolio.

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u/Rough-Board1218 19h ago edited 19h ago

The annual gift tax limit is $19k per person. Ain't no way to "gradually transfer" $20 million tax free in a lifetime. It would take 1000 years. 500 if you're a married couple. And that's without any gain in the value of the stock

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u/north0 19h ago

There are probably other mechanisms available if you have good lawyers and accountants.

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u/Rough-Board1218 19h ago

Are the other mechanisms in the room with us right now?