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Theus Law Offices is rated 5 out of 5.0 stars based on 5 review(s).

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Most people have many questions about estate planning but never make a move to go see an attorney. Before Theus' free seminar I did not even know their were attorneys that specialized in only estate planning. Thank goodness I attended...as I did not even know what asset protection was, even though I had assets. Most people think a written will is fine and pass away thinking that things will be as they wished/stated. Most times that is not the case. I urge you to go Theus Law Offices for consultation. They are friendly and down to earth with your wishes being #1. I cannot say enough good things about them. Now that I have gone to Theus I rest so much easier knowing that my wishes...are going to be held up...just as I wanted...no doubt about it....Thanks to the Theus family !

- Peyton Guillory

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The Theus Law Offices’ Family Estate Planning is a must from my perspective. I had recently lost my dad when I decide to attend the in-person Workshop at the time. My dad and I had attended a similar workshop some four (4) years prior but my dad didn’t elect at the time to move forward. I so wished that he (my dad) had done so because now I am helping my mom go through the Succession/Probate steps with a lawyer currently. If you or your loved ones haven’t made this decision with Estate Planning, I would strongly encourage you to attend this web-based workshop/webinar. Graves Theus is a great attorney to go with for this important step in you and your family’s planning for the future in many, many ways!!!

- Mark Johnson

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The Theus Law Offices’ Family Estate Planning is a must from my perspective. I had recently lost my dad when I decide to attend the in-person Workshop at the time. My dad and I had attended a similar workshop some four (4) years prior but my dad didn’t elect at the time to move forward. I so wished that he (my dad) had done so because now I am helping my mom go through the Succession/Probate steps with a lawyer currently. If you or your loved ones haven’t made this decision with Estate Planning, I would strongly encourage you to attend this web-based workshop/webinar. Graves Theus is a great attorney to go with for this important step in you and your family’s planning for the future in many, many ways!!!

- Mark Johnson

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They are a wonderful Team!

- Jessica Cole

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Estate planning is a complicated process, but my wife and I feel it is valuable and necessary. We started by attending an Estate Planning workshop offered by the Theus Law Offices and led by Jim Theus. That was about the wisest decision we have made in some time. We engaged the services of Theus Law Offices and have benefitted enormously from the direct working relationship with Jim Theus. They did not sign us up and then pass us off to a staff member. We worked with Jim Theus personally. When it was time to work with others of the staff, we found them friendly, knowledgeable, and professional. Jim Theus is exceptionally competent and patiently answers questions. His due diligence is admirable. We found their fees for estate planning reasonable and fair. You would be wise to consider using the services of Theus Law Offices if you are interested in estate planning. We are grateful for their help and recommend them to you without reservations. Our loved ones will also be the beneficiaries of a comprehensive plan, as are we. Doyle L Bailey

- Doyle Bailey

Blog

The net investment income tax is alive and well: How it can affect your estate plan


04 November, 2019

The Tax Cuts and Jobs Act (TCJA) reduced individual income tax rates, but it left the 3.8% net investment income tax (NIIT) in place. It’s important to address the NIIT in your estate plan, because it can erode your earnings from interest, dividends, capital gains and other investments, leaving less for your heirs.

How it works

The NIIT applies to individuals with modified adjusted gross income (MAGI) over $200,000. The threshold is $250,000 for joint filers and qualifying widows or widowers and $125,000 for married taxpayers filing separately. The tax is equal to 3.8% of 1) your net investment income, or 2) the amount by which your MAGI exceeds the threshold, whichever is less.

Suppose, for example, that you’re married filing jointly and you have $350,000 in MAGI. Presuming $125,000 in net investment income, your NIIT is 3.8% of $100,000 (the excess of your MAGI over the threshold, which is less than your net investment income), or $3,800.

Nongrantor trusts — with limited exceptions — are also subject to the NIIT, and at a much lower threshold: For 2019, the tax applies to the lesser of 1) the trust’s undistributed net investment income or 2) the amount by which the trust’s AGI exceeds $12,751.

Reducing the tax

You can reduce or eliminate the NIIT by lowering your MAGI, lowering your net investment income, or both. Techniques for doing so include:

  • Reducing this year’s MAGI by deferring income, accelerating expenses or maxing out contributions to retirement accounts,
  • Selling poor-performing investments to offset the losses against investment gains you’ve realized during the year, or
  • Reducing net investment income by investing in tax-exempt municipal bonds or in growth stocks that generate little or no current income.
    
    
If you own an interest in a business, you may be able to reduce NIIT by increasing your level of participation. Income from a business in which you “materially participate” isn’t considered net investment income. (But keep in mind that increasing your participation may, in certain cases, trigger self-employment tax liability.)

For trusts, you can reduce or eliminate the NIIT by:

  • Structuring them as grantor trusts,
  • Distributing the trust’s income to its beneficiaries (remember, the NIIT applies only to undistributed income), or
  • Shifting the trust’s investments into tax-exempt municipal bonds, growth stocks or tax-deferred investments (such as life insurance).
    
    
Keep in mind that, if you use a grantor trust, its income will be passed through to you as grantor, potentially increasing your personal liability for NIIT.

Review your plan

The NIIT can affect the financial performance of your personal investments as well as your trusts. To maximize the amount of wealth available for your heirs, be sure to consider strategies for reducing the impact of this tax. Contact us with any questions.

Theus Law Offices specializes in a complete range of estate planning and elder law services, including wills, trusts, probate, successions, estate administration and probate litigation. If you need a Louisiana wills and trusts lawyer or succession attorney in Alexandria, Lafayette, Lake Charles, Baton Rouge, New Orleans, Shreveport, Monroe, or elsewhere in Central Louisiana, let our certified estate planning specialist and probate lawyers help you.

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