Planning Saves Money, Eases Confusion

A few estate-planning tips:

* Communicate. Financial advisers say parents and children must discuss estate planning to ensure the orderly distribution of wealth, particularly if minor children or a family business are involved.

* Share. Future tax liabilities can be reduced through cash gifts. The government lets individuals give away $10,000 a year tax-free to each of as many people as they like. After a person dies, federal estate taxes are imposed on gifts and bequests to everyone but a spouse that exceed $600,000.

* Shelter. Married couples with substantial assets can create a “bypass trust” that provides benefits to a surviving spouse, but the assets aren’t taxed in the survivor’s estate. Up to $600,000 can be sheltered.

* Insure. So-called “second-to-die” insurance policies provide cash to survivors to pay estate taxes and other expenses.

* Consult. Estate planning is best left to professionals. But there are also many good books on the subject. Among them: “The Estate Planning Guide” by Martin M. Shenkman; and the Nolo Press self-help books “Plan Your Estate With A Living Trust,” and “Make Your Own Living Trust,” by Denis Clifford.