To effectively plan your estate, you must carefully consider the specific needs of each person on your inheritance list. There are numerous different ways to facilitate asset transfers. The best course of action will vary on a person by person basis. When you act in an informed manner, you can prevent unintended negative consequences. With this in mind, we would like to explain the value of special needs trusts. Government Benefit Recipients Many people who have disabilities are enrolled …
How Do You Stretch an IRA?
There is an old sing-along about this bone being connected to that bone. When it comes to financial planning, there is a similar type of interconnectedness. Your retirement plan is going to lead to a plan that addresses the expenses that you may face during your twilight years. The planning will ultimately culminate in the distribution of your estate to your loved ones. Retirement planning is typically going to include an individual retirement account. When you contribute into an individual …
Is a Revocable Living Trust Only for the Rich?
All trusts are not created equal. There are different trusts that are utilized to accomplish varying different objectives. Many people are under the assumption that trusts are only useful for the wealthy, but this is not the case. Irrevocable Trusts High net worth individuals often have estate tax concerns. There is a federal estate tax that carries a $5.34 million exclusion. If your assets exceed this amount, you must take steps to gain estate tax efficiency. It should also be noted …
June Seminars to Cover Living Trusts and Medicaid Asset Protection
Knowledge is power when you are planning your estate. When you have a thorough understanding of your options, you can make informed estate planning decisions. We make a concerted effort to disseminate sound information to our neighbors in and around Long Island. During the month of June we will be offering a series of seminars that will cover living trusts and Medicaid asset protection. These seminars are being offered free of charge, but we do ask that you register in advance so that we …
Will My Heirs Be Forced to Pay an Inheritance Tax?
People can sometimes get confused about taxes on asset transfers. In this post we would like to provide some clarity as we look at the difference between an inheritance tax and an estate tax. Inheritance Tax An inheritance tax would be levied on asset transfers to each nonexempt inheritor. Fortunately, there is no inheritance tax on the federal level. There are a handful of states in the union that impose state-level inheritance taxes. Our firm practices in the state of New York. There …
Is Your Estate Plan Part of a Holistic Financial Plan?
Many people are going through life without any estate plan at all, and there are those who think that an estate plan can be reduced to the creation of a last will. In fact, your estate plan should ideally be part of a holistic long-term financial plan. Your financial plan should prepare you for each stage of life. Retirement Planning Time can pass quickly. You may wake up one morning as a middle-aged person and come to the realization that you are not on track for retirement. It can take …
Is Probate Always Required?
Many people are not aware of the existence of probate. This is a legal process that takes place under the supervision of the Surrogate's Court in the state of New York. If you were to pass away without any type of estate planning documents at all, the court would utilize intestate succession laws to determine the way that your resources should be distributed. When a last will is used, the will must be admitted to probate. Generally speaking, any time you pass away in direct possession of …
Why Would I Want a Revocable Living Trust?
A revocable living trust is a very useful and popular estate planning device. There are a number of benefits that you gain when you create a revocable living trust, and we will look at a few of them in this post. Incapacity Planning Incapacity is quite common among elder Americans. There are various different causes of incapacity, but Alzheimer's disease is a leading culprit. Over 40 percent of people who are 85 years of age and older have contracted Alzheimer's disease. With a …
What Is a QDOT Trust?
In the field of estate planning the acronym QDOT stands for a qualified domestic trust. To understand the value of a qualified domestic trust, you must know a few things about the federal estate tax. Estate Tax Parameters The federal estate tax credit or exclusion is $5.34 million in 2014. This is the amount that can be transferred free of taxation. If you are leaving behind more than $5.34 million, the estate tax is potentially applicable. The tax carries a maximum rate of 40 percent. There …
What Is a QTIP Trust?
When you are looking for information about estate planning, you may run into a rather confusing series of acronyms. We try to demystify things here on our blog and explain what the alphabet soup is all about. In this post we will look at the legal device called a QTIP trust. Estate Planning & Remarriage Any time you are going through a significant life event, such as a change in marital status, you should discuss the estate planning implications with your attorney. Your existing estate …
Trusts for Estate Tax Efficiency
The federal estate tax can dramatically reduce the wealth that you are passing along to your family members. At the current time the top rate of this tax is 40 percent. This is quite a sizable chunk to be leaving behind to Uncle Sam as a parting gift. The amount of the federal estate tax exclusion is $5.34 million. Only the portion of your estate that exceeds this amount is potentially subject to the federal estate tax. If you intend to transfer assets that exceed this amount, you must …
When Does a Power of Attorney Become Effective?
Incapacity planning should be part of the equation when you are planning your estate. Of course you want to arrange for the transfer of your monetary assets after you die. But what about the period of time that will precede your passing? You should prepare for latter life contingencies as well. Possible Incapacity Many people become incapacitated to one extent or another before they pass away. If you were to become unable to handle your own financial decision-making, who would act on your …
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