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How Equity Residential Employees Can Benefit from Estate Planning During Market Volatility

Healthcare Provider Update: Offers three medical plan options including UHC PPO and Surest, with 100% preventive care coverage. Employees also receive dental, vision, HSAs, FSAs, and wellness incentives 7. With ACA premiums rising and subsidies expiring, Equitys employer-sponsored plans may provide better value and predictability for employees. Click here to learn more

'Equity Residential employees facing market downturns can leverage strategic estate planning opportunities, such as gifting undervalued assets and using tools like GRATs and Roth IRAs, to mitigate taxes and pass on more wealth to heirs—turning market volatility into an advantage.' – Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'Equity Residential employees should view market downturns as an opportunity to reassess their estate planning strategies, using tools like GRATs and Roth IRA conversions to transfer more wealth while mitigating tax liabilities for future generations.' – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How market downturns can present estate planning opportunities.
The strategic use of tools like GRATs and Roth IRA conversions.
The importance of charitable giving in reducing taxable estates during volatile periods.

Estate planning is often seen as a challenging process, particularly during volatile market conditions. Making decisions with long-term impacts can be difficult when share prices are erratic and future market performance is uncertain. However, careful planning during these volatile periods can lead to better future returns and more efficient asset transfer to successors. While many focus on estate planning during market upswings, some of the most strategic decisions can be made when asset values are declining, particularly for Equity Residential employees preparing for retirement.

Estate Planning and Volatility: A Strategic Advantage

Estate planning is often associated with market growth, focusing on transferring assets when prices are high. Yet, when assets are undervalued due to market downturns, significant opportunities often arise. The market's recovery after a sharp drop, like the one in April, shows how volatility can lead to wise decision-making. Future wealth transfers can be optimized by focusing on asset quantity instead of current value, as more shares can be passed on to heirs before gift-tax exemptions are exceeded, which can be an important strategy for Equity Residential employees planning their estates.

The concept of moving assets during a market downturn proves to be more beneficial for estate planners than it may initially appear. When asset prices are low, more shares can be transferred before hitting the $19,000 annual federal gift-tax exemption threshold for 2025. This strategy allows heirs to benefit from future growth once the market recovers, providing a valuable option for those at Equity Residential looking to optimize their estate planning during volatile times.

This approach is also useful for those aiming to stay under the $14 million per person lifetime federal estate tax exemption. For example, if a business was initially valued at $15 million but is now worth $14 million, a donor can place it in a trust. The tax-free transfer of future expansion to heirs keeps the business outside the donor's estate, a strategy that Equity Residential employees could consider when planning for their family's future.

Changes to Gifting Exemptions Affecting Taxes

Though market downturns can provide estate planning benefits, it’s important to remember that estate planning laws are always changing. With Congress debating potential changes to gifting amounts, it’s essential to act while exemptions remain high. If the estate tax exemptions aren't renewed, the exemption may revert to around $6.8 million, adjusted for inflation. This shift could greatly impact wealth transfer plans, so it’s vital for Equity Residential employees to take advantage of higher exemption levels while they are still in place.

Exploring Other Estate Planning Strategies

Grantor retained annuity trusts (GRATs) are another option for individuals who have already used their lifetime exemption but still want to reduce wealth transfer taxes. These irrevocable trusts allow individuals to leave assets to their heirs while retaining annuity income for a period. GRATs help mitigate estate taxes on any asset appreciation during the trust's duration, offering an option for Equity Residential employees looking to pass on their wealth in a tax-efficient way.

The Internal Revenue Service (IRS) sets the annuity payout rate at 120% of the applicable federal mid-term rate, which is currently 5%. For beneficiaries to profit from additional value, the asset's growth must exceed this hurdle rate. If the asset's growth surpasses this rate, the remaining balance in the trust is distributed to the heirs tax free. Equity Residential employees considering this strategy can potentially avoid estate taxes and preserve their wealth from future tax burdens.

Although current interest rates aren't exceptionally low, Dos Santos notes that using undervalued assets in a GRAT may still lead to favorable outcomes. By leveraging lower asset prices, individuals can establish GRATs with a higher chance of surpassing the hurdle rate when the market rebounds, a strategy that could be beneficial for Equity Residential employees who want to plan ahead.

A Simpler Approach: Switching to a Roth IRA

Not all estate planning strategies need to be complicated. Sometimes, simpler methods provide significant tax advantages. For instance, a 90-year-old Equity Residential employee switched from a $5 million traditional IRA to a Roth IRA during a period of market decline. The client reduced the taxable estate by paying the conversion taxes upfront, and now her son will receive the entire Roth IRA tax-free, along with any future gains.

Dos Santos believes this is a smart strategy, especially for seniors concerned about their taxable estates. By reducing the size of the estate, the Roth IRA allows its full value to be passed on tax-free to future generations, making it a great option for Equity Residential employees planning for their heirs.

The Importance of Thoughtful Estate Planning Decisions

Estate planning should be done with care, especially when using irrevocable trusts like GRATs. Once assets are placed in these trusts, they cannot be withdrawn, so individuals must carefully consider their choices. Nevertheless, strategic estate planning presents unique opportunities to pass on more wealth to heirs without incurring unnecessary taxes, particularly during market volatility. Equity Residential employees can make the most of these opportunities by strategically planning their estate transfers.

For those looking to efficiently transfer wealth and reduce their taxable estate, current market conditions may present opportunities. Market downturns can provide a tactical advantage, whether through Roth IRA conversions, using the federal estate tax exemption, or establishing GRATs. By focusing on the number of shares rather than current asset values, individuals can position themselves to realize long-term benefits and enable their heirs to inherit the full value of their transferred assets.

In conclusion, volatility is often viewed as a threat to financial stability, but it can actually be an asset when approached strategically. By leveraging low asset values during market downturns, Equity Residential employees can potentially increase future returns and build a better future for their heirs.

Tax Benefits of Charitable Giving in Estate Planning

When considering estate planning during volatile market periods, charitable giving offers additional tax benefits. By donating depreciating assets such as stocks or real estate directly to a charity, individuals can reduce their taxable estate and avoid paying capital gains tax on appreciated assets. This tactic not only reduces estate taxes but also allows individuals to give back.

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Sources:

1. Fuscaldo, Donna. 'Markets Are Down: Here's How Your Estate Can Benefit.' Kiplinger , 15 Mar. 2025, www.kiplinger.com . Accessed 26 May 2025.

2. Chmielewski, Paul. 'Estate Planning During Times of Market Volatility.' Cerity Partners , 25 Mar. 2025, www.ceritypartners.com . Accessed 26 May 2025.

3. Kiplinger Staff. 'Eight Ways to Financially Plan Your Way Through Challenging Times.' Kiplinger , 24 May 2025, www.kiplinger.com . Accessed 26 May 2025.

4. Kotlikoff, Laurence. 'This Move Can Save You Tons on Taxes in Retirement. It's Best to Go Big.' Barron's , 25 May 2025, www.barrons.com . Accessed 26 May 2025.

5. Branton, Steve. 'How Sequence of Returns Risk Could Affect Your Retirement—And What HNW Investors Should Do.' Investopedia , 25 May 2025, www.investopedia.com . Accessed 26 May 2025.

What are the eligibility requirements for employees to participate in the Equity-League Pension Plan, and how can they ensure compliance with these requirements to maximize their potential benefits during retirement?

Eligibility for the Equity-League Pension Plan: Employees become eligible to participate in the Pension Plan by working at least two weeks in covered employment during a 12-month period. To maximize benefits, employees should ensure they continue working in covered employment to accumulate Years of Vesting Service (YVS), which solidifies their entitlement to benefits even if they leave the industry(Equity-League_Pension_T…).

How do the contribution limits for the Equity-League 401(k) Plan compare to traditional IRAs, and what strategies can employees deploy to make the most of their contribution options as they approach retirement?

Contribution Limits Comparison: The Equity-League 401(k) Plan has higher contribution limits compared to traditional IRAs. Employees can contribute up to $19,000 annually (or $25,000 if over 50), while traditional IRAs are capped at $6,000 (or $7,000 for those over 50). By taking full advantage of catch-up contributions as they near retirement, employees can significantly boost their retirement savings(Equity-League_Pension_T…).

What approaches can participants in the Equity-League Pension Plan take to effectively manage their individual accounts, and how can they adjust their investment strategies based on changes in their employment status or retirement goals?

Managing Individual Accounts in the Pension Plan: Participants in the Equity-League 401(k) Plan can manage their accounts by selecting from various investment options, including age-based and equity funds. Adjusting investments based on career changes or retirement goals can help employees align their portfolios with their risk tolerance and retirement timeline(Equity-League_Pension_T…).

In what ways can employees of the Equity-League Pension Plan benefit from understanding the vesting schedule, and how can this knowledge impact their overall retirement planning and decision-making process?

Vesting Schedule: Understanding the vesting schedule is crucial for employees. Employees become vested by accumulating five YVS or by satisfying other vesting tests, such as the 25-year test. Once vested, employees secure their pension benefits, regardless of future employment changes(Equity-League_Pension_T…).

What are the tax implications for participants in the Equity-League Pension Trust Fund when taking distributions from their retirement accounts, and how can they optimize their withdrawals to minimize tax liabilities?

Tax Implications for Distributions: When taking distributions from their retirement accounts, employees may face a 10% penalty if withdrawals are made before age 59½. However, rolling over distributions into IRAs can help defer taxes. Employees should consult tax professionals to optimize withdrawals and minimize tax liabilities(Equity-League_Pension_T…)(Equity-League_Pension_T…).

How can employees ensure that their beneficiary designations are current within the Equity-League Pension Plan, and what steps should they take in the event of a life change, such as marriage or divorce, to protect their intended beneficiaries?

Beneficiary Designations: It’s important for employees to keep beneficiary designations current. In the event of life changes such as marriage or divorce, updating these designations ensures intended beneficiaries receive the appropriate benefits. Employees can contact the Fund Office to make updates(Equity-League_Pension_T…)(Equity-League_Pension_T…).

What resources are available for employees of the Equity-League Pension Trust Fund to educate themselves about their retirement rights under ERISA, and how can they utilize these resources to advocate for their interests effectively?

ERISA Resources for Employees: Employees are protected under ERISA, which guarantees certain rights regarding their retirement benefits. The Equity-League Pension Trust Fund provides resources such as the Summary Plan Description, and employees can access legal help if they believe their rights have been violated(Equity-League_Pension_T…).

How does the withdrawal process work for employees of the Equity-League Pension Plan, particularly in the context of normal retirement age and circumstances that may lead to early withdrawals?

Withdrawal Process: Employees can take withdrawals as early as age 60, but benefits will be reduced for each year prior to age 65. Early withdrawals may also incur penalties, so employees should consider the long-term financial impact before opting for early retirement(Equity-League_Pension_T…).

Given the significant assets under management in the Equity-League Pension Trust Fund, how do investment choices within the plan impact employees' potential retirement income, and what factors should be considered when selecting these investments?

Investment Choices: Investment options within the 401(k) Plan impact employees' retirement income. With 19 investment choices, including equity and fixed-income investments, participants should select funds that balance growth and risk, keeping in mind the potential long-term returns(Equity-League_Pension_T…).

What is the best way for employees to contact the Equity-League Pension Trust Fund for inquiries about their benefits or the retirement process, and what specific information should they be prepared to provide to facilitate a productive conversation?

Contacting the Fund for Inquiries: Employees can contact the Equity-League Pension Trust Fund by phone, email, or mail. When making inquiries, employees should provide personal details such as their participant ID and questions about specific benefits to ensure efficient assistance(Equity-League_Pension_T…).

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Pension Plan Name: Equity Residential does not offer a traditional defined benefit pension plan. Instead, they focus on other retirement savings options. Years of Service and Age Qualification: Not applicable, as Equity Residential does not have a traditional pension plan. 401(k) Plan: 401(k) Plan Name: Equity Residential 401(k) Plan. Who Qualifies: Full-time employees are eligible to participate in the 401(k) plan.

Restructuring and Layoffs: Equity Residential, a major player in the residential real estate sector, has recently undergone a restructuring phase aimed at optimizing operations and enhancing efficiency. This move comes in response to shifting market conditions and evolving tenant needs. As part of this restructuring, the company has streamlined its workforce to better align with its strategic objectives. While specific numbers of layoffs have not been disclosed, the company's focus has been on adapting to economic fluctuations and improving operational agility. It is crucial to monitor these developments due to the current economic environment, which includes challenges related to investment returns and regulatory changes impacting real estate. Understanding these adjustments can provide valuable insights into how real estate companies are navigating these complexities.

Equity Residential Stock Options and RSUs 2022 Equity Residential (EQR) offered both stock options and RSUs to its employees. The company typically uses EQR for stock options and RSU for Restricted Stock Units in its documentation. In 2022, employees at Equity Residential eligible for these benefits included senior executives and other key employees. 2023 In 2023, Equity Residential continued its practice of granting stock options and RSUs to select employees. The acronym EQR refers to stock options, while RSU denotes Restricted Stock Units within the company’s benefit structure. This year, the eligibility was similar to previous years, targeting executives and high-performing staff. 2024 For 2024, Equity Residential maintained its stock option and RSU programs with updates to the vesting schedules and grant sizes. Employees at Equity Residential can receive these benefits based on their role and performance, with EQR used for stock options and RSU for Restricted Stock Units. Eligibility remains focused on key positions and high contributors.

Equity Residential has been actively working on enhancing its employee healthcare benefits, particularly in the context of its Environmental, Social, and Governance (ESG) initiatives. In 2023, the company emphasized its commitment to creating a supportive environment for its employees by expanding healthcare offerings that include comprehensive medical, dental, and vision plans. These benefits are designed to support the diverse needs of its workforce, reflecting the company's broader commitment to social responsibility and employee well-being. Equity Residential has also integrated wellness programs aimed at promoting physical and mental health, recognizing the importance of employee well-being in sustaining long-term business success.