Can writing a living trust reduce estate tax in Washington?
It depends on the kind of trust you create. A simple probate-avoidance living trust has no effect on federal estate tax. However, more complicated living trusts, such as an AB trust, can reduce the federal estate tax bill for people who own a lot of valuable assets. (Most people, though, don’t need to worry about federal estate tax because it affects only estates worth more than $5 million.) For more information on when you still might want to use an AB trust to reduce estate taxes, see Nolo’s article Tax-Saving AB Trusts.
