[0:01] Welcome to plan on it.
[0:07] Hello, everyone, and welcome to plan on it with attorney Christopher E.
[0:11] Botti, board certified specialists in a state planning trust and probate law.
[0:16] Chris has more than 30 years of experience helping individuals and families
[0:21] protect what they've built. I'm Sean O'Connor, and today we're beginning a new
[0:25] advanced planning series on the show, and we have our first guest joining Chris
[0:31] is Chris Michail, who focuses on advanced estate planning strategies for higher
[0:36] net worth families and complex estates. In this first episode, we're talking
[0:41] about what advanced estate planning actually is,
[0:45] who is designed for, and why these strategies become important
[0:49] as the wealth grows. Gentlemen, good to see you.
[0:53] Good to see you. Good to see you, Sean. Hey, before we jump in,
[0:57] Chris Michail, I want to just ask you to share a little bit about your background,
[1:02] and what drew you toward this area of estate planning and listeners get a sense of who you are?
[1:07] Yeah, absolutely. I've been at Botti and Morrison at this firm for about
[1:13] coming up on a year soon. I've been practicing for five years. I had previous
[1:18] experience in tax law specifically, but my interest was always in a state planning.
[1:23] And so once they started really, just kind of the bread and butter of a
[1:28] estate planning, I really wanted to start getting more into advanced planning because it has much more
[1:35] that intersection of tax issues and then of course with drafting trust and working with clients
[1:44] considering their assets and their family dynamics. And so kind of bringing all that together,
[1:51] advanced planning kind of helps those families really kind of plan for the future in a way
[1:58] if their point is to minimize taxes and make sure that the money that they worked hard to accrue
[2:04] is going to go to their kids. That's what advanced planning kind of structures helps lead to that.
[2:14] Got it. Got it. I mean, would you say Chris, Chris Botti, in terms of if you were describing the,
[2:22] I don't know, the distinction, not to get too granular, the distinction between regular estate
[2:28] planning versus advanced estate planning, what would list what's the listeners take away
[2:34] for the biggest differences there? Think of the regular estate planning as the
[2:38] foundational documents. So like typically that foundation consists of a revokeable living trust
[2:44] here in California as part of the foundation along with powers of attorney, healthcare directors
[2:49] and all that. So you need to have that foundation a well-established foundation, solid foundation
[2:54] first before even considering doing advanced planning. And so what advanced planning
[2:58] essentially is is those people, those individuals who have high net worth, we'll get into that later
[3:03] in terms of what those thresholds are, need more than the basic foundational documents to
[3:08] avoid the federal state tax. And so all the different techniques that drive the advanced planning
[3:14] side of things are all based upon ultimately the goal of reducing the state tax liability
[3:18] and transfer of wealth to the next generation to the best possible. And so that's the idea.
[3:24] So we're super excited that, you know, I got Chris here, we brought on and we have two other
[3:28] attorneys also as part of our of council team that are making up this new department we established
[3:34] the advanced estate planning department in my firm. So it's I'm really excited about doing
[3:38] podcasts. The cake and deep dives into these various techniques that we will deploy to to avoid
[3:44] to get the results of the clients one way essentially. Yeah, that's great. I love this, you know,
[3:49] just a more an advanced, more sophisticated, almost level of knowledge needed. But, you know, is it
[3:57] is it just, is it just wealth, you know, dollar amounts that that sort of require the advance? So
[4:06] there are other, I'll say triggers that an estate might be is, you know, oh, especially complex or
[4:12] specific goals that would require is advanced estate planning. Sure, I mean, like the tax is the
[4:19] number one driver, right? The estate tax is typically the number one driver that gets you into the world
[4:24] of considering advanced planning. But there are other issues too that where you may have a complex
[4:29] family structure, a blended family structure, where you want to bake into the the foundational
[4:34] documents, certain controls to protect like the bloodlines, for example, with blended families.
[4:39] And so it's not only taxes, but to primarily taxes is the trigger for most people. But there are
[4:45] other scenarios to where there are other types of trusts out there beyond the standard revocable
[4:49] living trust that you can use to deal with complex family situations and the need to control things
[4:55] beyond the the person you created the trust is demise because of the structure of the family. So
[5:01] you know, there's several ways you can get there. Yeah, yeah. What about, I mean, obviously, you
[5:09] know, everybody likes to sail on their taxes, regardless of, regardless of income, Chris, Chris,
[5:17] Sam, you know, why, why is it do you think, why did taxes become such an important consideration?
[5:22] Once estates do reach a certain size? Yeah, I mean, Chris Botti, as obviously referred to it already,
[5:27] but it really comes down to the gift and estate tax, which are unified under the IRS system.
[5:33] And since 2017, it's it's increased substantially. So, you know, as of this year, it's 13.99 million
[5:40] or get it, you know, Accentually exceeding 14 million for an individual and for a couple, it's,
[5:45] you know, 28 getting close to 30 million essentially. So it was actually 15 million and 30 million
[5:51] for individuals. So that is really what it comes down to is the gift and estate tax. So any estates that
[5:58] are worth that are close to that those values or exceeding those, they, they have serious tax
[6:04] implications. If they exceed then it comes down to 40% tax on anything that exceeds that 15 or 30 million
[6:11] as of 2026. And so that that really is kind of the core of advanced planning, less so your income
[6:19] taxes or capital gains tax, it really comes down to the state and gift tax.
[6:25] Chris, be anything you want to add to that?
[6:28] Well, yeah, essentially, you know, for the first time in a long time, we finally had some
[6:32] certainty when it comes to the estate tax exemptions. Chris, I mentioned, there's a 15 million dollars per
[6:37] individual, a 30 million dollars for a married couple, if you properly plan. That's a significant
[6:42] sum of money. So most people aren't implicated by this, right? And so those who are, you know,
[6:47] it's a substantial potential hit. 40% tax above the exemption amount is, you know, a substantial amount
[6:54] of money. And, you know, the thing about the estate tax, it can be avoided with proper planning.
[7:00] There are all these techniques we'll be talking about going forward are designed to reduce or eliminate
[7:05] that liability. And with that's the ultimate goal of our clients, they would rather leave that money
[7:09] to their family versus to the IRS to the California franchise tax board, no offense guys.
[7:16] For someone hearing some of these concepts for the first time, are there
[7:23] misconceptions that you are dealing with sometimes with people about this, you know,
[7:28] advance the state planning, people come in with a certain impression of what it is and you have to
[7:33] kind of redirect them. They're common, common mistakes. I think the biggest misconception, maybe
[7:38] out there amongst clients is that somehow when you deploy these techniques and there's so many
[7:42] different varieties of them that does a complete lack or loss of control, that there's no way
[7:48] to guarantee the outcome that somehow you're seeding control to another person who's going to take,
[7:55] you know, take it from there. And that's not necessarily the case. You can still retain elements of
[7:59] control with these advanced techniques. And that's probably the biggest misconception out there.
[8:04] Chris, anything you've encountered? No, I agree with that too. Yeah, I think that's essentially
[8:11] what it is is people think because it's irrevocable that in some sense they're losing control of
[8:16] these assets entirely, which is absolutely not the case, right? And there are different structures,
[8:20] of course. A lot of times and we'll discuss one of them as a granular retained annuity trust, where
[8:26] it actually is, you know, in control of the the the grantors themselves. So there isn't, you know,
[8:33] necessarily complete loss of these assets. And there are certainly myriad of ways to make sure that
[8:40] there is that level of control and power actually that the that the the grantors do retain throughout
[8:46] the process. Oh, I'm looking forward to getting into it. I know you mentioned a couple of a couple of
[8:53] specific strategies. And you know, and this is a new series, which is super, super interesting for
[9:03] folks and an exciting evolution for the firm as you describe. As we get into this, what can people
[9:09] expect? Like what are some of the advanced planning strategies? We're going to we're going to get
[9:13] into pretty soon here for future episodes. Can you tease any of that? Yeah, I can. I mean, so,
[9:20] I mean, here's the bottom line. You start off with this process with a clean slate. Like you you bring
[9:25] the client in and find out what their objectives are, right? Because that drives ultimately the type of
[9:29] planning we're going to recommend. And so there's so many different types of trust out there. It's like
[9:33] the alphabet soup of trust. And we're going to go through a bunch of those trusts. We'll try to cover
[9:38] them all throughout the entire series. But you know, you first got to make it just a general assessment
[9:43] of what are your objectives here? And then go from there. And so we're going to talk about
[9:47] charitable remainder trusts, for example, family limited partnerships, for example,
[9:51] intensely defective grant or trust. You know, there is slacks. I mean, there's it's an endless
[9:56] cornucopia of potential trust out there that can be can be used when deployed to help with these
[10:03] issues. And so that so yeah, each one is worthy of its own separate drill down and a deep dive.
[10:08] That's podcast because there's somewhat technical, but you know, they're amazing with their
[10:14] capable of doing. And so the idea is let's let's get people out there thinking about this stuff. And
[10:19] you know, we get it get them to worry about it because it's a huge concern. You just can't sit on
[10:25] your hand to ignore it. If you have a large sign up with a state, it's that problem's not going to go
[10:30] away. Right, right, right. That's great. Thanks for that sort of peak behind a curtain, Chris.
[10:39] And yeah, I mean, some of this, I mean, I'm much more of a layman in this category and it is nice
[10:46] just to like, okay, hear the terms, understand some rudimentary sort of general things about it,
[10:52] and our listeners will get some familiarity and then get into some of the the gritty details.
[10:58] I'm sure I'm looking forward to it. Anything you want to add before we wrap up here?
[11:03] I know we'll talk again in the near future. No, I just I just I guess to summarize with my commitment
[11:09] with using the podcast series to educate people. And you know, I'm super excited about the fact that
[11:15] we've got this department going and we're looking forward to, you know, helping people down the road with
[11:20] with these issues and helping them plan to secure their future and their family's future. So it's
[11:25] super exciting for us. We're awesome. Hey, I look forward to I look forward to going on the ride
[11:32] with with you and the team. Thanks for being here. Chris, Chris, Michail, Chris,
[11:37] botti, great great talking to you both. And I look forward to future conversations.
[11:43] Thanks, John. Thanks, John. Good to see you. You bet. That's it for today's episode of plan on it
[11:48] with attorneys Christopher botti and Chris Michail to access more resources, including upcoming
[11:54] estate planning workshops and educational materials, visit bottilaw.com. That's b-o-t-t-i-l-a-w.com.
[12:04] Thanks for listening. I'm Sean O'Connor. Do us a favor. Leave a review, subscribe to the show,
[12:08] maybe share a link with someone in your world who would be interested in in this new advanced
[12:14] planning series. That would be much appreciated and very helpful. Have a great day.
[12:29] Like the post, share or tag friends and family who could benefit from clear, practical,
[12:33] estate planning guidance.
[0:07] Hello, everyone, and welcome to plan on it with attorney Christopher E.
[0:11] Botti, board certified specialists in a state planning trust and probate law.
[0:16] Chris has more than 30 years of experience helping individuals and families
[0:21] protect what they've built. I'm Sean O'Connor, and today we're beginning a new
[0:25] advanced planning series on the show, and we have our first guest joining Chris
[0:31] is Chris Michail, who focuses on advanced estate planning strategies for higher
[0:36] net worth families and complex estates. In this first episode, we're talking
[0:41] about what advanced estate planning actually is,
[0:45] who is designed for, and why these strategies become important
[0:49] as the wealth grows. Gentlemen, good to see you.
[0:53] Good to see you. Good to see you, Sean. Hey, before we jump in,
[0:57] Chris Michail, I want to just ask you to share a little bit about your background,
[1:02] and what drew you toward this area of estate planning and listeners get a sense of who you are?
[1:07] Yeah, absolutely. I've been at Botti and Morrison at this firm for about
[1:13] coming up on a year soon. I've been practicing for five years. I had previous
[1:18] experience in tax law specifically, but my interest was always in a state planning.
[1:23] And so once they started really, just kind of the bread and butter of a
[1:28] estate planning, I really wanted to start getting more into advanced planning because it has much more
[1:35] that intersection of tax issues and then of course with drafting trust and working with clients
[1:44] considering their assets and their family dynamics. And so kind of bringing all that together,
[1:51] advanced planning kind of helps those families really kind of plan for the future in a way
[1:58] if their point is to minimize taxes and make sure that the money that they worked hard to accrue
[2:04] is going to go to their kids. That's what advanced planning kind of structures helps lead to that.
[2:14] Got it. Got it. I mean, would you say Chris, Chris Botti, in terms of if you were describing the,
[2:22] I don't know, the distinction, not to get too granular, the distinction between regular estate
[2:28] planning versus advanced estate planning, what would list what's the listeners take away
[2:34] for the biggest differences there? Think of the regular estate planning as the
[2:38] foundational documents. So like typically that foundation consists of a revokeable living trust
[2:44] here in California as part of the foundation along with powers of attorney, healthcare directors
[2:49] and all that. So you need to have that foundation a well-established foundation, solid foundation
[2:54] first before even considering doing advanced planning. And so what advanced planning
[2:58] essentially is is those people, those individuals who have high net worth, we'll get into that later
[3:03] in terms of what those thresholds are, need more than the basic foundational documents to
[3:08] avoid the federal state tax. And so all the different techniques that drive the advanced planning
[3:14] side of things are all based upon ultimately the goal of reducing the state tax liability
[3:18] and transfer of wealth to the next generation to the best possible. And so that's the idea.
[3:24] So we're super excited that, you know, I got Chris here, we brought on and we have two other
[3:28] attorneys also as part of our of council team that are making up this new department we established
[3:34] the advanced estate planning department in my firm. So it's I'm really excited about doing
[3:38] podcasts. The cake and deep dives into these various techniques that we will deploy to to avoid
[3:44] to get the results of the clients one way essentially. Yeah, that's great. I love this, you know,
[3:49] just a more an advanced, more sophisticated, almost level of knowledge needed. But, you know, is it
[3:57] is it just, is it just wealth, you know, dollar amounts that that sort of require the advance? So
[4:06] there are other, I'll say triggers that an estate might be is, you know, oh, especially complex or
[4:12] specific goals that would require is advanced estate planning. Sure, I mean, like the tax is the
[4:19] number one driver, right? The estate tax is typically the number one driver that gets you into the world
[4:24] of considering advanced planning. But there are other issues too that where you may have a complex
[4:29] family structure, a blended family structure, where you want to bake into the the foundational
[4:34] documents, certain controls to protect like the bloodlines, for example, with blended families.
[4:39] And so it's not only taxes, but to primarily taxes is the trigger for most people. But there are
[4:45] other scenarios to where there are other types of trusts out there beyond the standard revocable
[4:49] living trust that you can use to deal with complex family situations and the need to control things
[4:55] beyond the the person you created the trust is demise because of the structure of the family. So
[5:01] you know, there's several ways you can get there. Yeah, yeah. What about, I mean, obviously, you
[5:09] know, everybody likes to sail on their taxes, regardless of, regardless of income, Chris, Chris,
[5:17] Sam, you know, why, why is it do you think, why did taxes become such an important consideration?
[5:22] Once estates do reach a certain size? Yeah, I mean, Chris Botti, as obviously referred to it already,
[5:27] but it really comes down to the gift and estate tax, which are unified under the IRS system.
[5:33] And since 2017, it's it's increased substantially. So, you know, as of this year, it's 13.99 million
[5:40] or get it, you know, Accentually exceeding 14 million for an individual and for a couple, it's,
[5:45] you know, 28 getting close to 30 million essentially. So it was actually 15 million and 30 million
[5:51] for individuals. So that is really what it comes down to is the gift and estate tax. So any estates that
[5:58] are worth that are close to that those values or exceeding those, they, they have serious tax
[6:04] implications. If they exceed then it comes down to 40% tax on anything that exceeds that 15 or 30 million
[6:11] as of 2026. And so that that really is kind of the core of advanced planning, less so your income
[6:19] taxes or capital gains tax, it really comes down to the state and gift tax.
[6:25] Chris, be anything you want to add to that?
[6:28] Well, yeah, essentially, you know, for the first time in a long time, we finally had some
[6:32] certainty when it comes to the estate tax exemptions. Chris, I mentioned, there's a 15 million dollars per
[6:37] individual, a 30 million dollars for a married couple, if you properly plan. That's a significant
[6:42] sum of money. So most people aren't implicated by this, right? And so those who are, you know,
[6:47] it's a substantial potential hit. 40% tax above the exemption amount is, you know, a substantial amount
[6:54] of money. And, you know, the thing about the estate tax, it can be avoided with proper planning.
[7:00] There are all these techniques we'll be talking about going forward are designed to reduce or eliminate
[7:05] that liability. And with that's the ultimate goal of our clients, they would rather leave that money
[7:09] to their family versus to the IRS to the California franchise tax board, no offense guys.
[7:16] For someone hearing some of these concepts for the first time, are there
[7:23] misconceptions that you are dealing with sometimes with people about this, you know,
[7:28] advance the state planning, people come in with a certain impression of what it is and you have to
[7:33] kind of redirect them. They're common, common mistakes. I think the biggest misconception, maybe
[7:38] out there amongst clients is that somehow when you deploy these techniques and there's so many
[7:42] different varieties of them that does a complete lack or loss of control, that there's no way
[7:48] to guarantee the outcome that somehow you're seeding control to another person who's going to take,
[7:55] you know, take it from there. And that's not necessarily the case. You can still retain elements of
[7:59] control with these advanced techniques. And that's probably the biggest misconception out there.
[8:04] Chris, anything you've encountered? No, I agree with that too. Yeah, I think that's essentially
[8:11] what it is is people think because it's irrevocable that in some sense they're losing control of
[8:16] these assets entirely, which is absolutely not the case, right? And there are different structures,
[8:20] of course. A lot of times and we'll discuss one of them as a granular retained annuity trust, where
[8:26] it actually is, you know, in control of the the the grantors themselves. So there isn't, you know,
[8:33] necessarily complete loss of these assets. And there are certainly myriad of ways to make sure that
[8:40] there is that level of control and power actually that the that the the grantors do retain throughout
[8:46] the process. Oh, I'm looking forward to getting into it. I know you mentioned a couple of a couple of
[8:53] specific strategies. And you know, and this is a new series, which is super, super interesting for
[9:03] folks and an exciting evolution for the firm as you describe. As we get into this, what can people
[9:09] expect? Like what are some of the advanced planning strategies? We're going to we're going to get
[9:13] into pretty soon here for future episodes. Can you tease any of that? Yeah, I can. I mean, so,
[9:20] I mean, here's the bottom line. You start off with this process with a clean slate. Like you you bring
[9:25] the client in and find out what their objectives are, right? Because that drives ultimately the type of
[9:29] planning we're going to recommend. And so there's so many different types of trust out there. It's like
[9:33] the alphabet soup of trust. And we're going to go through a bunch of those trusts. We'll try to cover
[9:38] them all throughout the entire series. But you know, you first got to make it just a general assessment
[9:43] of what are your objectives here? And then go from there. And so we're going to talk about
[9:47] charitable remainder trusts, for example, family limited partnerships, for example,
[9:51] intensely defective grant or trust. You know, there is slacks. I mean, there's it's an endless
[9:56] cornucopia of potential trust out there that can be can be used when deployed to help with these
[10:03] issues. And so that so yeah, each one is worthy of its own separate drill down and a deep dive.
[10:08] That's podcast because there's somewhat technical, but you know, they're amazing with their
[10:14] capable of doing. And so the idea is let's let's get people out there thinking about this stuff. And
[10:19] you know, we get it get them to worry about it because it's a huge concern. You just can't sit on
[10:25] your hand to ignore it. If you have a large sign up with a state, it's that problem's not going to go
[10:30] away. Right, right, right. That's great. Thanks for that sort of peak behind a curtain, Chris.
[10:39] And yeah, I mean, some of this, I mean, I'm much more of a layman in this category and it is nice
[10:46] just to like, okay, hear the terms, understand some rudimentary sort of general things about it,
[10:52] and our listeners will get some familiarity and then get into some of the the gritty details.
[10:58] I'm sure I'm looking forward to it. Anything you want to add before we wrap up here?
[11:03] I know we'll talk again in the near future. No, I just I just I guess to summarize with my commitment
[11:09] with using the podcast series to educate people. And you know, I'm super excited about the fact that
[11:15] we've got this department going and we're looking forward to, you know, helping people down the road with
[11:20] with these issues and helping them plan to secure their future and their family's future. So it's
[11:25] super exciting for us. We're awesome. Hey, I look forward to I look forward to going on the ride
[11:32] with with you and the team. Thanks for being here. Chris, Chris, Michail, Chris,
[11:37] botti, great great talking to you both. And I look forward to future conversations.
[11:43] Thanks, John. Thanks, John. Good to see you. You bet. That's it for today's episode of plan on it
[11:48] with attorneys Christopher botti and Chris Michail to access more resources, including upcoming
[11:54] estate planning workshops and educational materials, visit bottilaw.com. That's b-o-t-t-i-l-a-w.com.
[12:04] Thanks for listening. I'm Sean O'Connor. Do us a favor. Leave a review, subscribe to the show,
[12:08] maybe share a link with someone in your world who would be interested in in this new advanced
[12:14] planning series. That would be much appreciated and very helpful. Have a great day.
[12:29] Like the post, share or tag friends and family who could benefit from clear, practical,
[12:33] estate planning guidance.
