Inheritance Presentation 12/15/22
December 14, 2022•485 words
(The information below is from the yesterday's presentation with some notes. Slides can be found here.)
About Corey San Diego
- Bitcoin/DIY enthusiast
- Not an expert
- Don't trust, verify!
What if you died tomorrow?
Concepts
Custody (Who can move funds?)
Trusted third parties (Who do you rely on?)
Cold storage (Where are your keys?)
Multi-sig (Wallet with multiple signers)
Fellowship & quorum (Total and minimum required for a multisig wallet)
What are the options?
Traditional
Professional Executor or Lawyer
Bitcoin knowledge can vary
Have a "legacy" understanding/experience
Exchanges
Built for trading, not for inheritance
Many keep funds there
Third party multisig
-
Notes
Each company offers a plan that holds one of your keys. UC is 2-of-3, Casa is 3-of-5.
DIY
Open-source tools.
A lot of careful planning.
Not for the faint of heart.
Considerations
Setup
Cost
Privacy/Security/Durability
Maintenance and monitoring
Execution
Taxes
Notes
Robustness or reliability are probably better words than durable.Tools
Bitcoin Wallet
Trusts (template)
Notes
This has not been vetted by a lawyer, but might pass.Trustee/Executor
Dead man's switch?
Advanced/future tech
Timelock
Covenants
Taproot scripts and smart contracts
| Consideration | Exchange | Third Party Multisig (Casa and Unchained) | DIY |
|---|---|---|---|
| Setup | n/a. Can't name beneficiaries? |
Technical- High touch Legal- all inclusive? |
Can be difficult, many considerations. |
| Cost | n/a | UC- $200 once Casa- Part of Diamond plan ($5k/year) |
Low Cost of notary (recommended) Cost of executor/trustee(can be a friend) |
| Privacy | Full KYC and a target of the IRS | Full KYC1,2 | Can be fully private. |
| Security (theft) | lol | High Multisig prevents theft. |
Can be as secure as UC/Casa. |
| Durability (loss) | lol | Moderate You must carefully manage your keys. |
Nuanced Must be balanced with security and privacy. |
| Maintenance | No proof until withdrawal. | Test your keys. Trust the third party. |
Highly manual. Might have trusted individuals. |
| Execution | Difficult. Probate generally required | Dedicated support, no probate. | Can be seamless or a nightmare. |
Notes
Casa uses closed-source apps for their products, so the code can't be audited by anyone. Still, since you trust them to hold only 1 or 2 keys, they never have a quorum to move funds.Tax Considerations
- Inheritance (Fed)
- Estates over $12.92($25.84) million
- Short-term capital gains
- Income tax
- Long-term capital gains (CA)
- Income tax
- Long-term capital gains (Fed)
- 0% up to $44,625($89,250)/yr
- 15% from up to $492,300($553,850)/yr
- Gifts
- Tax free up to $17k/person/year.
Notes
Someone commented that giving tax free gifts don't reduce the size of your estate for inheritance tax purposes. This is worth exploring.
- Tax free up to $17k/person/year.
Ideas for future presentations
coreyedwards@pm.me
References