What is Involved in Upstream Planning?

Upstream planning
Please Share!

“Upstream planning” is important with multi-generational wealth.

Not all people have the same estate planning needs.

Some people will use all of their retirement savings and have little to nothing to pass to their children.

Others have significant wealth and would like these funds to pass from generation to generation.

According to a recent Kiplinger article titled “Expecting an Inheritance? Consider Coordinating Your Estate Plan with Your Parents’,” estate planning with future inheritances in mind is known as “upstream planning.”

Upstream planning is useful in wealth transfer.
Open communication is key to upstream planning.

For inter-generational planning to be successful, the details of the family wealth and the plans for the assets should not be kept secret from the heirs and beneficiaries.


If your estate plan is large enough to be require the payment of estate taxes, it is likely your heirs will have greater burdens tied to their inheritances.

To minimize the estate taxes and to provide more wealth to pass to heirs, you should consider utilizing an inheritance trust.

With an inheritance trust, assets belong to the trust and are protected from divorces, trial lawyers, and bankruptcies.

Upstream planning can also involve a generation-skipping transfer tax (GSTT) exemption planning.

By directing the executor to apply the GSTT exemption to the trust, the distributions made to grandchildren will not be taxed.

Upstream planning is also essential when a family business is a part of the estate.

If you own a business and this business is now being run by one child or grandchild, you will need to clarify how this will be included in the inheritance.

Do you want the one running the business to be the sole heir?

Do want the other family members to receive shares in the business or simply provide them with cash or alternative assets?

Those families with greater wealth have more to lose in taxes from neglecting conversations around estate planning than the average American household.

Upstream planning involves conversations around family values, plans for the futures, and advice for success.

If you have reservations or are unsure how to proceed with upstream planning, work with an experienced estate planning attorney to create a plan to meet the needs of your family.

Reference: Kiplinger (Oct. 4, 2022) “Expecting an Inheritance? Consider Coordinating Your Estate Plan with Your Parents’”

Get All The Marketing Updates
Recent Posts
Search Our 2,400 Blog Post Archive