02/27/2026
⚖️ Five moves that estate planning attorneys recommend all the time. Not one of them is wrong. But every one of them creates a tax consequence that most families do not find out about until the money has already changed hands.
Adding a child to a deed is the one I see most often. The parent thinks they are simplifying things. The child ends up with the parent's original cost basis instead of a stepped-up basis at death. On a home with $300K in appreciation, that is a potential $45,000+ capital gains tax bill that did not need to exist.
The trust-as-IRA-beneficiary issue is less well known but arguably worse. In 2026, a non-grantor trust hits the top 37% federal bracket at just $16,000 in taxable income. An individual does not reach that rate until $640,600. If IRA distributions flow into a trust that does not distribute them to beneficiaries, the tax rate can nearly double compared to a direct inheritance.
None of these moves are bad in isolation. The problem is when estate planning and tax planning happen in separate conversations, with separate professionals, at separate times. The estate attorney sets up the structure. The CPA files the return. Nobody connects the two until a tax bill arrives.
The fix is not complicated. It is one meeting where both sides of the plan are in the same room.
