Is it time to review your estate plan?

When did you last review your estate plan?  How long ago did you put in place your estate plan?  5 years? 10 years?  Over 10 years?  Do you currently have an estate plan in place?

 

Reviewing one's estate plan serves at least two critical functions.  First, a review can guarantee your plan still functions according to your wishes.  All these questions can be answered by comprehensively reviewing your estate plan:

·         Do your assets still go to who you want?

·         Are the correct people listed in decision-making roles?

·         Have your desires changed for who you want to receive your assets?

·         Have certain decision-makers moved away?

·         Have minor children now become responsible adults who are ready to serve on your behalf?

Secondly, a review can alert you to new laws affecting your estate plan?  An example from a few years ago would be the changes regarding access to medical records with the Health Insurance Portability and Accountability Act (HIPAA).  A more recent example is the 2017 Tax Cuts and Jobs Act, which changed estate and gift taxation rules.  Whether it is the State Legislature or Congress, both organizations continue to pass laws to meet changing circumstances.  Staying up-to-date can mean the difference between a plan accomplishing your goals and a plan that causes unneeded problems and headaches.

For all our clients, we offer complimentary reviews every 3 years.  For clients, it is a chance to review their estate plan to ensure everything is current and there are no major changes requiring updates due to the passage of new laws.  For us, it is a chance to talk with clients and ensure their estate plan continues to meet their objectives.

If you have not put in place any estate planning documents, you are not alone.  In fact, you are in the majority!  Shocking numbers indicate that over 50% of people pass away with no estate planning documents in place.  https://www.usatoday.com/story/money/personalfinance/2015/07/11/estate-plan-will/71270548/  This often leads to countless hours, disputes, and unnecessary stress on loved ones who are dealing with your passing. 

Whether you worked with us in the past or wish to work with us in the future, give us a call today or send us an e-mail by clicking here!  We are always happy to assist individuals, businesses, and families, plan for a smooth and seamless future!

What's the big deal with Estate Taxes?

Earlier today, President Trump signed into law the Tax Cuts and Jobs Act of 2017, capping one of the most significant tax overhauls in the last 30 years. One of the items sure to generate conversation is the changes made to estate taxes.

Before we review the changes made to the estate tax, let's look back at the previous state of the estate tax. Prior to the passage of the 2017 Act, the last major estate tax change occurred in 2012.
Toward the end of 2012, Congress passed the American Taxpayer Relief Act (ATRA). It was signed into law by then-President Obama on January 2, 2013. ATRA amended the prior laws regarding estate taxes and set the estate tax rate at 40%. However, the 40% tax rate was only applicable to individuals who, at their death, sought to pass assets in excess of $5,000,000. So, while a 40% tax rate was high, a minimal number of individuals were affected.

To go even further, ATRA included an inflation-protection rider, further increasing the exemption level with each passing year. In 2018, the exemption level was set to increase to $5,600,000. This means, under ATRA, an individual who died in 2018 could leave $5,600,000 to any number of individuals, charities, etc. without having to pay a single penny in estate taxes.

For a married couple, the ATRA rules allow a virtual doubling of the estate tax exemption level, provided the proper tax forms are timely filed. In essence, this would have allowed both spouses, cumulatively, to transfer up to $11,200,000, without triggering any estate taxes in 2018.

Now let's review the Tax Cuts and Jobs Act of 2017. With the signing of the 2017 Act, the estate tax exemption is doubled (currently, for years 2018-2025). This means that where before an individual could exempt $5,600,000, an individual can now shelter $11,200,000 from any estate taxes. For a married couple, properly utilizing the exemption rules, the exemption is doubled to $22,400,000. If no further action is taken by Congress prior to 2025, the exemption amounts will revert to the previous ATRA levels.

With such a high exemption level, only about 0.3% of the population needed to worry about estate taxes under ATRA (and now it is even less, with the exemption doubling),.  This does not mean though that the other 99.7% of the population does not need to complete their estate plan.

Instead of focusing on estate tax avoidance, we can now examine your personal goals and how to protect your assets and your family. This includes protecting assets from beneficiaries, avoiding the probate process, and ensuring a smooth passing of your assets to your chosen beneficiaries.  If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments, while achieving your personal goals.

This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Make 2017 the Year You Complete Your Estate Plan!

The start of the New Year almost always brings with it new goals and resolutions.  So, what is the best way to meet these goals head-on and successfully complete them?  Oftentimes, the key is in not taking one giant leap, but small steps, providing us the best possible chance to succeed!

 

With estate planning, adopt a similar approach.  Taking manageable steps can make all the difference between completing your estate plan and giving yourself and your family peace of mind, and putting it off for another year, potentially putting your loved ones at risk in the event something happens to you.  Here are just a few benefits of putting an estate plan in place:

 

Nominate an individual you trust to make health care decisions:  Nominating a trusted individual who knows your health care wishes can ensure your desires are followed.  Without planning ahead, your family is likely to have to go to Court before making health care decisions on your behalf, incurring additional money and time during an already stressful period.

 

Name someone to manage your financial affairs if you are unable to do so:  Executing a Financial Power of Attorney ensures your financial affairs continue seamlessly during your life and any legal decisions can be made on your behalf.  In the absence of a Financial Power of Attorney, no one can legally make these decisions for you, whether that person is a spouse, a child, or a close friend.

 

Provide for your children and loved ones from future potential creditors, predators, and unnecessary taxes:  Protecting your loved ones from others and sometimes themselves, can ensure your desires are followed.  A proper plan promotes family harmony upon your passing by making the process proceed smoothly without undue stress and delays.

 

Protect your assets, both during your lifetime and after:  Planning ahead can make all the difference in protecting your most cherished assets for yourself and your family members.  Advanced planning options to protect assets in the event of a need for advanced health care expenses may be warranted to protect your assets.

 

To take the first step toward giving yourself peace of mind and a lasting legacy come to our free educational seminar being held in the Village of Hilbert Community Room on Saturday, February 4th at 10:00 AM.  We will be providing an overview of how a properly drafted comprehensive estate plan can save your family time, money, and promote harmony among your beneficiaries.  Please call or e-mail our Client Services Director Sandie at sandie@epgwi.com to reserve your spot today!

 

 

For more information about this seminar and our upcoming events, go to www.TheEstatePlanningGroup.com today!