Estate Planning Tool Used by Jacqueline Kennedy is Now Optimized for Large Year-End Tax Deductions

Scottsdale, AZ – (NewMediaWire) – October 13, 2022 – Current market conditions afford high income Americans a unique generational wealth opportunity using an IRS-approved charitable giving vehicle first adopted by the Kennedy family, according to Elevating Your Estate And Legacy: A Lesson From Jackie Kennedy, a recent analysis released by Forbes Finance Council’s new estate planning attorney, Jonathon Morrison. In that piece, the Kennedys’ estate planning practices are detailed, including how a significantly more advanced “optimized” variant of charitable lead annuity trust (OCLAT) has improved upon the Kennedys’ previous strategy.

“The first lady was onto something; however, over the past 50 years, favorable IRS rulings and regulations have made elements of the original Kennedy trust infinitely more attractive.  In its state-of-the-art ‘optimized’ form, we have proven that the CLAT is the most attractive IRS-approved income tax deduction vehicle available to the ultra-wealthy, the working-rich, and individuals experiencing a significant capital event.  For philanthropic-minded individuals, there is simply no other investment vehicle that comes close to the results produced by the Optimized CLAT,” said the OCLAT’s lead architect Jonathon Morrison.  

As detailed in Mr. Morrison’s peer-reviewed article which made the cover of the national Estate Planning Journal, the Optimized CLAT stretches the “regular CLAT chassis” as far as IRS caselaw allows (thereby maximizing the tax and financial benefits enjoyed by the contributor) and then repurposes the charitable trust into a year-end tax deduction strategy which combines four key financial benefits to “outperform nearly all other traditional investment vehicles”:

• -The contributor enjoys a dollar-for-dollar tax deduction in the year of funding (providing immediate tax savings) subject to an exceptionally-large funding cap (30% AGI without phaseout);
• -The OCLAT returns an expected 2-5x of the initial contribution amount back to the contributor after significant donations to charity are made over a term of years;
• -The OCLAT assets may be gifted to children or heirs without the 40% federal gift/inheritance tax; and
• -The OCLAT assets are exempt from the contributor’s personal creditors.

“When we have big pullbacks in the stock market, it’s generally a great time to phase in extra cash. Since the 1950s, recessions resulted in an average drawdown of 30%, yet the S&P 500 averaged approximately 101% following five years from the recession trough date,” said Stephen Seo, Chief Investment Officer of RVW Wealth. “The OCLAT is attractive because it unlocks lots of cash that would otherwise be taxed after an asset sale, which is especially compelling for my California clients in the top tax bracket. The income tax savings can be substantial and clients are thrilled to learn they can redirect these funds to new investments, as well as to their favorite charities,” Seo explained.

The OCLAT needs to be funded by December 31 to enjoy a 2022 income tax deduction. 

Elevating Your Estate And Legacy: A Lesson From Jackie Kennedy provides in depth tax planning findings and recommendations for wealth advisors, chief investment officers, CPAs, entrepreneurs, and high earned income Americans. Visit Jonathon Morrison at Frazer Ryan Goldberg & Arnold LLP at www.frgalaw.com/attorneys/morrison to learn more, and to discover OCLAT research, FAQs, and tax planning materials. Follow Jonathon on LinkedIn at www.linkedin.com/in/jonathonmorrison

About Jonathon M. Morrison

A senior partner at Frazer Ryan Goldberg & Arnold, Forbes Finance contributor, and Best Lawyers® honoree, Jonathon Morrison’s practice is focused on tax, business and estate planning for clients with large or complex estates. He is licensed in both Arizona and California and is a Certified Specialist in Estate Planning, Trust and Probate Law in California.

After a decade practicing with preeminent estate planning law firms in Silicon Valley, Jonathon gained a mastery of modern, advanced estate and tax planning strategies. With his unique background, Jonathon enjoys a reputation for developing advanced estate planning solutions for high income and high net worth clients whose objectives include income tax and estate tax minimization, charitable and philanthropic giving, business exit and succession planning, and asset protection.

Jonathon is also a frequent speaker and nationally recognized authority with respect to a specific type of charitable vehicle: the “optimized charitable lead annuity trust” (OCLAT). Jonathon is frequently engaged by clients, advisors and attorneys around the country to implement and provide advice with respect to OCLAT planning.

About Frazer Ryan Goldberg & Arnold LLP

Frazer Ryan Goldberg & Arnold is a nationally recognized boutique law firm strategically structured to satisfy the unique needs and high expectations of individuals, families, and closely held businesses. For more than 30 years, Frazer Ryan Goldberg & Arnold has maintained its reputation as the premier tax and estate planning law firm in Arizona. 

Widely respected for its dedication to “private client” matters, Frazer Ryan’s 26 skilled and innovative attorneys — including more than a dozen tax and estate planners, five dedicated trust/estate litigators, and four dedicated tax litigators (including former IRS trial attorneys) — are organized as service-specific teams that provide peer-recognized insight, depth, and skill in the firm’s six core areas: Estate Planning, Tax Controversy, Trust and Estate Controversies, Business and Corporate Law, and Elder Law.

Consistently ranked by statewide publications as a Top 3 Tax and Estate Planning law firm, Frazer Ryan is one of only 50 companies selected for the 2022 edition of Arizona’s Most Admired Companies, a business-excellence recognition program co-sponsored by Arizona Business magazine. In 2022, US World News and Report named Frazer Ryan as a Regional Tier 1 law firm in Trust & Estate Law, Tax Litigation, and Trust & Estate Litigation. Thirteen of the firm’s attorneys have been recognized as The Best Lawyers in America®.

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