Estate Tax Planning in Simi Valley

Estate Tax Planning in Simi Valley

California has no estate tax. The federal estate tax applies, and at current exemption levels, most Simi Valley families are not exposed. I will be honest about that rather than invent a problem that does not exist for you. For most residents, what matters is making sure assets transfer correctly through a funded trust and that beneficiary designations are up to date, not advanced estate tax strategies.

I am an estate planning attorney serving Simi Valley and all of Ventura County. I do this work over Zoom or phone and sign in person. For the full estate planning overview, see estate planning in Simi Valley.

When combined assets add up faster than expected

A Simi Valley family with a $750,000 home, combined retirement account balances of $1.5 million, $250,000 in a brokerage account, and $500,000 in life insurance has a $3 million estate. Against the 2026 federal exemption of $15,000,000 per person, or $30,000,000 for a married couple, permanent under the One Big Beautiful Bill Act, that family is nowhere close to a federal tax problem. Where it gets more complicated is for single individuals with larger estates, and for business owners whose company has significant and growing value. For those people, planning now still makes sense.

What makes sense for Simi Valley families right now

The most important estate-tax-related move for most Simi Valley families is making sure life insurance is owned correctly, because life insurance death benefits are included in the taxable estate if you own the policy. An irrevocable life insurance trust can take the policy out of your estate. Beyond that, correct beneficiary designations and a funded revocable trust handle most situations. For families with business interests pushing the estate total higher, high-net-worth estate planning and asset protection connect to the same conversation.

Questions Simi Valley clients ask

If I set up an irrevocable trust and the estate tax never applies to me, was it wasted? Irrevocable trusts also provide asset protection and can serve other estate planning goals. Whether the estate tax applies or not, the structure may still be worth having. But I will not recommend it if the only justification is a tax problem that does not exist for you.

Does my 401(k) count toward my taxable estate? Yes. Retirement accounts are part of your taxable estate for estate tax purposes, even though they pass income-tax-free to your estate. The income tax on the inherited retirement account is a separate obligation that your heirs pay as they withdraw.

What is portability and does it affect me? Portability allows a surviving spouse to use the deceased spouse’s unused estate tax exemption. It requires filing an estate tax return at the first spouse’s death to elect portability, even if no tax is owed. It is worth doing in most married couples’ situations as insurance in case the estate grows substantially in the years after the first death.

Talk to Eric or call 805-244-5291. I serve Simi Valley and all of Ventura County.

For families transferring a home between generations, the Proposition 19 reassessment calculator can estimate the property-tax impact of a parent-child or grandparent-grandchild transfer.