High Net Worth Individuals Face a Challenging Wealth Planning Landscape


LBMC Experts Share Five Key Factors Affecting Estate Planning

David Frederick, J.D., LL.M., is a Senior Manager of Private Client Tax Services at LBMC, PC.

David Frederick discusses wealth planning challenges faced by high net worth individuals in this changing legal and economic environment.
David Frederick discusses wealth planning challenges faced by high net worth individuals in this changing legal and economic environment.

NASHVILLE, Tenn., July 05, 2023 (GLOBE NEWSWIRE) — LBMC, a top accounting, advisory and business consulting firm in the nation, shares expertise on how high net worth individuals can navigate the changing estate planning landscape.

The United States is facing a shifting legal and economic environment that will substantially impact estate planning and wealth transfer structures. High net worth individuals must pay close attention to new conditions and how they will impact their wealth planning strategies. Experts warn that now is the time to seek professional guidance to weather the storm and safeguard financial legacies.

“Given the upcoming changes in tax laws, regulatory environments, and economic conditions, it is vital for high net worth individuals to proactively review and adjust their wealth planning strategies,” advises David Frederick, J.D., LL.M., Senior Manager of Private Client Tax Services at LBMC, PC. “Collaborating with an estate planning professional will help individuals protect their wealth, optimize tax savings, and ensure a smooth transition for future generations.”

Here are five key factors affecting estate planning in the coming months.

Reduction of the Estate Tax Exemption: Effective January 1, 2026, the estate tax exemption is set to be effectively cut in half from about $13 million per person to about $7 million per person, depending on inflation. This reduction will make taxable some estates that would have previously avoided the tax and impose a greater tax on estates exceeding the revised threshold. While 2026 seems like a long way off,  individuals must proactively evaluate now and potentially restructure their estate plans to mitigate the impact of the revised estate taxes.

New Scrutiny of Grantor Trusts: Grantor trusts, a popular estate planning structure utilized to minimize estate taxes, are facing increased scrutiny from politicians in Washington. Recently discussed legislative changes may limit or eliminate the benefits of these trusts. Estate plans relying on the grantor trust structure may need to be reassessed and alternative structures considered.

Reduced Privacy with the Corporate Transparency Act: The Corporate Transparency Act is eliminating some vital elements of privacy associated with using LLCs and similar business structures. High net worth individuals using these structures for asset protection and confidentiality will need to adapt to new regulations, potentially with high administration costs and lower privacy protections.

Increased IRS Scrutiny: The Internal Revenue Service (IRS) has announced plans to bolster its workforce by adding over 80,000 new agents over the next ten years. This expansion signals the potential for increased scrutiny of estate plans by tax collectors. Individuals with tax-mitigating structures must ensure their plans are compliant and effectively managed, and they may face higher administrative costs.

Challenging Economic Environment: An uncertain economic environment characterized by elevated inflation, high interest rates, and the looming potential of a recession adds further complexity to wealth planning. Growth-oriented estate planning structures may become less attractive due to increased market volatility, and alternative structures may be necessary.

To navigate this increasingly complex landscape, high net worth individuals are strongly encouraged to seek guidance from experienced estate planning professionals. These experts possess the knowledge and expertise necessary to navigate the intricate web of legislative changes, taxation considerations, and economic uncertainties that lie ahead.

To learn more about navigating the challenges of wealth planning in the evolving landscape, please contact David Frederick at [email protected].

About LBMC

LBMC is a 2023 Forbes Best Tax and Accounting Firm, one of the Southeast’s largest accounting and business consulting firms, and an Accounting Today Top Firm in the Nation serving approximately 10,000 clients with diverse needs across a spectrum of industries. Primary client groups include privately-owned middle market companies in the healthcare, manufacturing, technology, and private equity space. LBMC has more than 800 team members, with offices in Chattanooga, Nashville (Brentwood), and Knoxville, Tennessee, and Charlotte, North Carolina. Founded in 1984 as a traditional accounting firm, LBMC today offers a broad range of advisory and business consulting needs for its client base. Recently named an Inc. Best in Business company, LBMC is an industry leader in financial, human resources, technology, cyber risk, and wealth advisory services for businesses and individuals. For more information, visit our website.


  • David Frederick, J.D., LL.M., is a Senior Manager of Private Client Tax Services at LBMC, PC.
CONTACT: Lisa Namm LBMC 6153092356 [email protected] 

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