As the year winds down, many people start thinking about holiday plans, family gatherings, and tying up loose ends. But there’s one area that often gets overlooked until it’s too late: your trust and estate plan.
Whether you’re protecting family wealth, reducing taxes, or making sure your wishes are clearly documented, the months before December 31 are your final chance to take advantage of certain strategies that can save you money, time, and stress in the future.
At Cornerstone Trust, we see year-end as a critical checkpoint. Laws change, markets shift, and family circumstances evolve — and your estate plan needs to keep pace. Here are five smart trust and estate moves to make before the calendar flips to a new year.
1. Review and Update Your Estate Plan Documents
Estate planning isn’t a “set it and forget it” process. Life events — such as marriage, divorce, births, deaths, or significant changes in your financial situation — can all impact the effectiveness of your plan. Even without major life changes, it’s wise to review documents annually to ensure they still reflect your wishes and comply with current laws.
What to Do Before Year-End
- Update Beneficiaries: Confirm beneficiary designations on retirement accounts, life insurance, and payable-on-death accounts match your intentions.
- Check Executor and Trustee Designations: Are the people you’ve named still the right choice?
- Align with Current Laws: The federal estate tax exemption in 2025 is $13.61 million per individual (double for married couples).
Pro Tip: Even small oversights, like outdated addresses or a deceased beneficiary, can cause major headaches for your heirs later.
2. Maximize Your Annual Gift Tax Exclusion
The IRS allows you to give up to $19,000 per person in 2025 (subject to inflation adjustments) without incurring gift tax or using your lifetime exemption. This means a married couple can jointly gift $38,000 to each recipient.
These gifts can significantly reduce the size of your taxable estate over time while also allowing you to see loved ones benefit from your generosity during your lifetime.
What to Do Before Year-End
- Make Gifts Now: Use your annual exclusion amount before December 31 or lose it — it does not roll over.
- Gift to Trusts: Instead of giving cash outright, consider funding an irrevocable trust for children or grandchildren. This allows you to control how and when the funds are used.
- Fund 529 Plans: Contributions to 529 education savings plans can also qualify for the annual exclusion.
Pro Tip: If you have a large estate, consistent annual gifting can be one of the simplest and most effective wealth transfer strategies.
3. Use Charitable Giving to Reduce Taxes
Year-end charitable contributions can be a win-win: you support causes you care about while potentially reducing your taxable income. Strategic giving can also align with your estate plan by establishing a charitable legacy.
What to Do Before Year-End
- Donate Appreciated Assets: Instead of cash, consider donating stocks or other appreciated assets you’ve held for more than a year. This can eliminate capital gains taxes while giving you a deduction for the asset’s fair market value.
- Set Up a Donor-Advised Fund (DAF): Contribute to a DAF before year-end to secure an immediate tax deduction, then recommend grants to charities over time.
- Charitable Trusts: Consider a charitable remainder trust (CRT) or charitable lead trust (CLT) to combine giving with income or estate tax benefits.
Pro Tip: Ensure all charitable gifts are made and properly documented by December 31 to claim deductions for the current year.
4. Take Advantage of Market Opportunities
Markets can be volatile, and downturns — while unsettling — can also open the door for certain estate planning techniques that work best when asset values are temporarily lower.
What to Do Before Year-End
- Roth Conversions: If your income is lower this year or investments are down, converting traditional retirement accounts to Roth IRAs may be more tax-efficient.
- Grantor Retained Annuity Trusts (GRATs): These can be particularly effective when interest rates and asset values are favorable, allowing more wealth to pass to heirs with little or no gift tax.
- Intra-Family Loans: Lock in low interest rates for loans to family members, which can be used to fund business ventures, home purchases, or education.
Pro Tip: Timing is key. Consult with your trust advisor and CPA to align market strategies with your long-term estate goals.
5. Coordinate with Your Financial and Tax Advisors
Estate planning doesn’t happen in a vacuum — it’s deeply connected to your tax strategy, investment plan, and insurance coverage. A coordinated, year-end review ensures everything works together.
What to Do Before Year-End
- Schedule a Year-End Planning Meeting: Bring together your attorney, financial advisor, CPA, and trust officer.
- Review Tax-Loss Harvesting Opportunities: Offset capital gains by selling losing investments before year-end.
- Check Asset Titling: Make sure assets are titled in the correct name (individual, joint, trust) to match your estate plan.
Pro Tip: A short meeting now can prevent costly mistakes, missed deadlines, or conflicting strategies later.
The Bottom Line: Act Before the Clock Runs Out
The end of the year is more than just a time for reflection — it’s your final opportunity to lock in financial moves that can protect your legacy, minimize taxes, and ensure your loved ones are taken care of.
Estate planning isn’t just about documents — it’s about taking consistent, strategic actions that align with your long-term vision. And the window to make those moves for this year closes at midnight on December 31.
If you’d like to review your trust and estate plan before the year ends, our team at Cornerstone Trust is here to help. We’ll work with your advisors to make sure you don’t miss a single opportunity.