When you have no idea how to proceed or what to expect, taking on a necessary task can be intimidating. Procrastination can set in, and when it comes to estate planning, this is risky business. With this in mind, we will share three tips in this post to clear up some of the unknowns. You probably do not have to be concerned about taxation. An influx of income will typically trigger taxation, so you will naturally be concerned about this when you are thinking about your estate. In fact, when …
The Anatomy of an Estate Plan
One of the reasons why it is important to discuss your unique situation with an attorney is because there is no one-size-fits-all estate plan that is right for everyone. This being stated, there is a basic framework that would apply to every plan in a general sense. Let’s look at the anatomy of an estate plan so you can go forward with some foundational knowledge. Asset Transfer Vehicle The fact that there will be an asset transfer vehicle at the core of your estate plan is pretty …
Inheritance Safeguards for Spendthrifts
It can be disconcerting when you have someone that is not a good money manager on your inheritance list. This person may have come to you seeking financial assistance on multiple occasions over the years. There is no doubt that you want to leave them an inheritance, but what if they burn through it too quickly? They may have nowhere to turn when the going gets rough. Fortunately, there is a relatively simple solution that you can utilize if you are in this position, and we will look at it …
Be Prepared to Update Your Estate Plan
Because so many people procrastinate before they put an estate plan in place, when they finally take action, they tuck the documents away in a lock box somewhere. They forget about the whole matter, because they feel as though it is behind them forever. In reality, this is a big mistake. Various different events can come down the pike that will trigger the need for estate plan updates, and we will look at some of them here. Changes in Marital Status Unfortunately, a significant percentage …
Consider a Self-Settled Asset Protection Trust
There are people that have concerns about possible creditor claims that may present themselves in the future. The potential difficulties can be related to debts or lawsuit judgments or settlements. Individuals that are in certain high-risk professions often fall into this category. These would include doctors, attorneys, real estate developers, architects, and some others. If you would like to protect your assets from future claimants, there is a legal device that may be the right choice …
A Living Trust Can Be the Ideal Estate Plan Centerpiece
Far too many people assume that a will is the right estate planning document to use unless you have complicated holdings or unusual objectives. In fact, the revocable living trust is the ideal estate planning centerpiece for a wide range of people, and we will look at the benefits here. Streamlined Estate Administration You probably want your loved ones to receive their inheritances in a timely manner after you pass away. After all, the assets were yours, why should they be stuck in limbo for …
When Is a Trust Better Than a Will?
You should explore your options when you are planning your estate, because there are many tools in the estate planning toolkit. There are a number of situations that would call for a trust of some kind instead of a will, and we will look at some of them in this post. Estate Tax Efficiency There is a federal estate tax that can take a big bite out of your legacy because it carries a 40 percent top rate. We also have a state-level estate tax to contend with as New Yorkers, and it has a graduated …
When Is an Irrevocable Trust Used?
There are many different tools in the estate planning toolkit, and the right course of action will depend upon the circumstances. This is why it is very important to sit down and have a meaningful conversation with an estate planning attorney when you get serious about the process. When you do this, you may find out that you should use an asset transfer vehicle that you have never heard of before. Generally speaking, there are two different types of trusts: revocable trusts, and …
A Look at Probate-Free Asset Transfers
If you are just getting started trying to gather information about estate planning, you may hear the term “probate avoidance” and wonder what it is all about. First off, to know why you might want to avoid probate, you have to know exactly what it is. Probate can be defined as the legal process of estate administration. This involves the probate court examining the will to determine its validity and then acting as a supervising entity as the wishes of the deceased are carried out in a …
Avoid These Estate Planning Mistakes
People often make assumptions about estate planning that lead to errors that can yield negative consequences. In this post, we will share three of them so that you can steer clear of these traps that can ensnare you. Trusts Are Only Useful for Wealthy People One misconception that many folks embrace is the idea that a trust is never appropriate unless you are extremely wealthy with a complicated portfolio. While it is true that individuals that are in this position do use trusts, but there are …
Top Three Reasons to Use a Living Trust
A lot of people that have always assumed that they should use a last will go in a different direction when they learn all the facts. The revocable living trust is an alternative that is far more beneficial for a wide range of people. Let’s look at three reasons why you may want to use a living trust as the centerpiece of your estate plan. Probate Avoidance If you use a last will to state your final wishes, you would name an executor to serve as the administrator. This person would not be able …
Blue Wave May Lead to Transfer Tax Changes
Since Joe Biden is now president and the Democrats control the House and the Senate, it is very likely that we will see some significant legislative changes. A couple of them may impact taxes on inheritances, and we will share the details in this post. Federal Estate Tax Exclusion The exclusion is the amount that can be transferred before the federal estate tax would be levied on the remainder. In 2010, there was an estate tax repeal due to a provision contained within the Bush era tax …
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