Posted On: DECEMBER 2020
We live in uncertain times. There’s uncertainty about the economy as well as the possibility of tax increases to address the rising federal debt. For example, there’s renewed interest in proposals that would slash the historically high gift and estate tax exemption. In light of this uncertainty, it’s a good idea to consider estate planning tools that offer asset protection as well as flexibility to adjust your plans to changing circumstances. One such tool is the special power of appointment (SPA) trust.
Read MorePosted On: DECEMBER 2020
Valuation and estate planning go hand-in-hand. After all, the tax implications of various estate planning strategies depend on the value of your assets at the time they’re transferred.
Read MorePosted On: DECEMBER 2020
It’s often said that a main reason people put off creating an estate plan is because of the difficulty in choosing a guardian for their children. However, that decision is one of the most important estate planning decisions you must make.
Read MorePosted On: DECEMBER 2020
The need for a will as a key component of your estate plan may seem obvious, but you’d be surprised by the number of people — even affluent individuals — who don’t have one. A reason for this may be a common misconception that a revocable trust — sometimes called a “living trust” — obviates the need for a will.
Read MorePosted On: DECEMBER 31st 2020
If you’ve worked to build a large estate, you undoubtedly would like to leave a lasting legacy to your children and future generations. Educating your children about saving, investing and other money management skills can help keep your legacy alive.
Read MoreSenior Living Options, Knowing When Is The Right Time And Getting Prepared.
Read MorePosted On: DECEMBER 23rd 2020
Precise language is critical in wills, trusts and other estate planning documents. A lack of clarity may be an invitation to litigation. An example of this is the dispute that arose after Tom Petty’s death between his widow and his two daughters from a previous marriage. (The two parties have since resolved their differences and dismissed all litigation matters.)
Read MorePosted On: DECEMBER 17th 2020
When planning your estate, it’s critical to balance estate tax planning and income tax planning. The rub is that, currently, strategies for reducing estate taxes generally focus on removing assets from your estate, while strategies for reducing income taxes generally focus on including assets in it...
Read MorePosted On: DECEMBER 10th 2020
If you have a family member who is disabled, you likely know that financial and estate planning can be tricky. You don’t want to jeopardize his or her eligibility for means-tested government benefits such as Medicaid or Supplemental Security Income (SSI). A special needs trust (SNT) is one option to consider. Another is to open a Section 529A account, often referred to as an ABLE account, because it was created by the Achieving a Better Life Experience (ABLE) Act...
Read MorePosted On: DECEMBER 2020
As President-elect Joe Biden moves forward with the transition and prepares for the inauguration next month, you may be wondering how the federal estate tax may be affected...
Read MorePosted On: DECEMBER 1st 2020
According to literature, the “seven deadly sins” are lust, gluttony, greed, laziness, wrath, envy and pride. Although individuals may be guilty of these from time to time, other types of “sins” can be fatal to an estate plan if you’re not careful. Here are four transgressions to avoid...
Read MorePosted On: NOVEMBER 19th 2020
S corporations must comply with several strict requirements or risk losing their tax-advantaged status. Among other things, they can have no more than 100 shareholders, no more than one class of stock and only certain types of shareholders...
Read MorePosted On: NOVEMBER 12th 2020
The executor’s role is critical to the administration of your estate and the achievement of your estate planning objectives. So your first instinct may be to name a trusted family member as executor. But that might not be the best choice...
Read MorePosted On: NOVEMBER 5th 2020
If you’re an art collector, it’s critical for your estate plan to address your collection separately from other types of assets. Investments in artwork may be motivated in part by potential financial gain, but for most collectors the primary motivation is a passion for the art itself...
Read MorePosted On: OCTOBER 29th 2020
Portability allows a surviving spouse to apply a deceased spouse’s unused federal gift and estate tax exemption amount toward his or her own transfers during life or at death. For 2020, the exemption amount is $11.58 million, and the IRS just announced that that amount will increase to $11.7 million for 2021...
Read MorePosted On: OCTOBER 22nd 2020
Typically, an estate plan includes accommodations for your spouse, children, grandchildren and even future generations. But you may overlook some older family members, such as your parents or in-laws. They may also need your financial assistance and help with their estate planning...
Read MorePosted On: OCTOBER 15th 2020
You may view your will as the centerpiece of your estate plan. But other documents can complement it. For example, if you haven’t already done so, consider writing a letter of instruction...
Read MorePosted On: OCTOBER 1st 2020
The COVID-19 pandemic has resulted in many people borrowing from their companies’ qualified retirement plans, and the CARES Act provides some temporary rule changes to this loan type. However, given the risks and costs of borrowing from a retirement plan, it should generally be viewed as a last resort. From an estate planning angle, subtracting funds from your retirement plan will leave less for your heirs if you were to unexpectedly die before you can repay the loan...
Read MorePosted On: OCTOBER 2020
If your estate plan makes use of a revocable trust — sometimes known as a “living trust” — it’s critical to ensure that the trust is fully “funded.” Revocable trusts provide significant benefits, including the ability to avoid probate of the assets they hold and facilitating management of your assets in the event you become incapacitated....
Read MorePosted On: OCTOBER 2020
As we continue to recover from the COVID-19 pandemic and much of the economy reopens, the “new normal” demands continued social distancing in many areas of life. What does this mean for estate planning? Clearly, estate planning is as important today — or arguably more important — than ever...
Read MorePosted On: SEPTEMBER 2020
The Centers for Medicare and Medicaid Services has reported that nearly 70% of people over age 65 will need long-term care (LTC) services and support at some point in their lives. Needless to say, the cost of long-term home health care or an extended stay at a nursing home...
Read MorePosted On: SEPTEMBER 2020
If you own a closely held business, it likely represents a significant portion of your wealth; wealth that your loved ones will rely on as a source of income after your death. So, the valuation of the business for gift and estate tax purposes is critical to determining how much of your estate goes to your family and how much goes to the government...
Read MorePosted On: SEPTEMBER 10th 2020
Do you own a business with one or more individuals? Undoubtedly, your interest in the business represents a substantial part of your net worth and is likely your “pride and joy.” So it’s normal if your fondest wish is for the business to continue long after you’re gone or for you to keep it running if a co-owner or partner dies...
Read MorePosted On: SEPTEMBER 3rd 2020
With the federal gift and estate tax exemption now at a record high $11.58 million for 2020, most estates aren’t taxable. But that doesn’t mean making lifetime gifts isn’t without significant benefits — even if your estate isn’t taxable under the current rules. Let’s examine reasons why gifting remains an important part of estate planning...
Read MorePosted On: AUGUST 27th 2020
In a world that is increasingly paperless, you are likely becoming accustomed to conducting a variety of transactions digitally. But when it comes to your last will and testament, only an original, signed document will do...
Read MorePosted On: AUGUST 20th 2020
If you are going through a divorce, you probably feel a little overwhelmed by all the legal and financial items you must attend to before the marriage termination is final. These tasks can be difficult, but revising your estate plan does not have to be...
Read MorePosted On: AUGUST 13th 2020
You may use a qualified disclaimer to refuse a bequest from a loved one. Doing so will cause an asset to bypass your estate and go to the next beneficiary in line. What are the reasons you would take this action? Here are five reasons...
Read MorePosted On: AUGUST 6th 2020
It is August, and that means it is time to get ready to go back to school for many students. If your child recently graduated from high school and is heading to college in the next few weeks, besides assembling the essentials — such as clothing, toiletries, bedding and a laptop — consider having your child “pack” a few estate planning documents that he or she may need at this stage of life...
Read MorePosted On: AUGUST 2020
Regardless of the stage of life you’re currently in, it’s important to bear in mind that your estate plan isn’t a static document. Reviewing and revising your estate plan is critical — because what’s important to you in your 20s or 30s likely will be different in your 60s or 70s. Let’s review some general estate planning guidelines to follow as you progress through life...
Read MorePosted On: AUGUST 2020
You’d be surprised how often people fail to disclose foreign assets to their estate planning advisors. They assume that these assets aren’t relevant to their “U.S.” estate plans, so they’re not worth mentioning. But if you own real estate or other assets outside the United States, it’s critical to address these assets in your estate plan...
Read MorePosted On: July 2020
Many people, when planning their estates, simply divide their assets equally among their children. But “equal” doesn’t necessarily mean “fair.” It all depends on your family’s circumstances. Providing for grandchildren is one area where equal treatment can inadvertently result in unfairness...
Read MorePosted On: July 2020
As people continue to grapple with the fallout from the novel coronavirus (COVID-19) pandemic, it’s important to consider the impact of the crisis on your retirement and estate plans. Few people are immune to the virus’s financial effects, but there are strategies available that can aid your recovery. These include estate planning opportunities that are especially effective in the current environment, as well as relief available under the Coronavirus Aid, Relief, and Economic Security (CARES) Act...
Read MorePosted On: July 30th 2020
You have probably seen it in the movies or on TV: A close-knit family gathers to find out what is contained in the will of a wealthy patriarch or matriarch. When the terms are revealed, a niece, for example, benefits at the expense her uncle, causing a ruckus. This “bad blood” continues to boil between estranged family members, who will not even speak to one another...
Read MorePosted On: July 23rd 2020
You may think of trusts as estate planning tools — vehicles for reducing taxes after your death. While trusts can certainly fill that role, they are also useful for protecting assets, both now and later...
Read MorePosted On: July 16th 2020
Nearly everyone owns at least some digital assets, such as online bank and brokerage accounts, bill-paying services, cloud-based document storage, digital...
Read MorePosted On: July 9th 2020
If you have adopted children or unadopted stepchildren, estate planning is critical to ensure that your property is distributed the way you desire...
Read MorePosted On: July 2nd 2020
Are you a multitasker? If so, you may appreciate an estate planning technique that can convert assets into a stream of lifetime income, provide a current tax deduction and leave the remainder to your favorite charity — all in one fell swoop. It is the aptly named charitable remainder trust (CRT)...
Read MorePosted On: June 25th 2020
The annual gift tax exclusion allows you to transfer up to $15,000 per beneficiary gift-tax-free for 2020, without tapping your lifetime gift and estate tax exemption. And you can double the exclusion to $30,000 per beneficiary if you elect to split the gifts with your spouse...
Read MorePosted On: June 4th 2020
Using a revocable trust — sometimes referred to as a “living trust” — is a common estate planning strategy to manage one’s assets during life and to avoid probate at death. For the trust to be effective, you must “fund” it, meaning transferring ownership of your assets to the trust...
Read MorePosted On: June 2020
The Setting Every Community Up for Retirement Enhancement (SECURE) Act is one of the most significant pieces of retirement plan legislation in years. In addition to affecting your retirement planning strategies, the new law may also impact your estate plan, especially if your beneficiaries will inherit IRAs or employer-provided retirement accounts....
Read MorePosted On: June 2020
Although much of estate planning deals with what happens after you die, it is equally important to have a plan for making critical financial or medical decisions if you are unable to make them for yourself....
Read MorePosted On: May 2020
Probate can be time consuming and expensive, and perhaps its biggest downside is that it is public. In fact, anyone who is interested can find out what assets you owned and how they are being distributed after your death...
Read MorePosted On: May 2020
Traditionally, estate planning has focused on more technical objectives, such as minimizing estate and gift taxes and protecting assets against creditors’ claims or frivolous lawsuits. These goals are still important, but affluent families are increasingly turning their attention to “softer,” yet equally critical, aspirations, such as educating the younger generation and preparing...
Read MorePosted On: May 21st 2020
Some of the most effective estate planning strategies involve setting up irrevocable trusts. For a trust to be deemed irrevocable, you, the grantor, lose all incidents of ownership of the trust’s assets. In other words, you are effectively removing those assets from your taxable estate...
Read MorePosted On: May 14th 2020
There are several tools you can use to build flexibility into your estate plan. Flexibility is especially important now because of an uncertain estate planning environment...
Read MorePosted On: May 7th 2020
The novel coronavirus (COVID-19) pandemic has refocused people’s thoughts on the health and safety of their families. In addition to taking the necessary steps today to protect your loved ones, it is equally important to consider their financial security in the future....
Read MorePosted On: April 30th 2020
If you have outstanding loans to your children, grandchildren or other family members, consider forgiving those loans to take advantage of the current, record-high $11.58 million gift and estate tax exemption. Bear in mind that in 2026, the exemption amount will revert to $5 million ($10 million for married couples), indexed for inflation...
Read MorePosted On: April 23rd 2020
Many people’s estates typically include IRAs. Be aware that two major laws passed into law recently, the Setting Every Community Up for Retirement Enhancement (SECURE) Act and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, have had a direct effect on IRAs...
Read MorePosted On: April 16th 2020
The novel coronavirus (COVID-19) pandemic and the resulting economic fallout is dealing a crushing blow to charitable organizations. Indeed, during a time when food banks, disaster relief and other nonprofit services are needed most by the public, their funding is suffering due to cancelled fundraising events and other factors...
Read MorePosted On: April 9th 2020
Generally, it’s recommended that you review your estate plan at year’s end. It’s a good time to check whether any life events have taken place in the past 12 months or so that affect your plan.
However, with a life shock as monumental as the coronavirus (COVID-19) pandemic, now is a good time to review your estate planning documents to ensure that they’re up to date — especially if you haven’t reviewed them in a number of years...
Posted On: March 2020
For many people, an important goal of estate planning is to leave a legacy for their children, grandchildren and future generations. And what better way to do that than to help provide for their educational needs? A 529 plan can be a highly effective tool for funding tuition and other educational expenses on a tax-advantaged basis. But when the plan’s owner (typically a parent or grandparent) dies, there’s no guarantee that subsequent owners will continue to use it to fulfill the original owner’s vision...
Read MorePosted On: March 2020
Today, most people communicate, shop, bank and even sign documents online. But one area that hasn’t yet embraced the digital revolution is estate planning. Most people continue to execute wills and related documents with paper and ink at a lawyer’s office in the presence of witnesses and a notary public...
Read MorePosted On: March 2020
A central tenet of any estate plan is the protection of your assets. You’ve worked a lifetime to build your wealth, and you undoubtedly want to pass as much of it to your loved ones as possible...
Read MorePosted On: March 2020
One advantage of inheriting an IRA from your spouse is that you’re entitled to transfer the funds to a “spousal rollover IRA.” The rollover IRA is treated as your own IRA for tax purposes, which means you need not begin taking required...
Read MorePosted On: March 26th 2020
If you’ve invented something during your lifetime and had it patented, your estate includes intellectual property (IP). The same goes for any copyrighted works. These assets can hold substantial value, and, thus, must be addressed by your estate plan. However, bear in mind that these assets are generally treated differently than other types of property...
Read MorePosted On: March 5th 2020
Payable-on-death (POD) accounts provide a quick, simple and inexpensive way to transfer assets outside of probate. They can be used for bank accounts, certificates of deposit or even brokerage accounts. Setting one up is as easy as providing the bank with a signed POD beneficiary designation form. When you die, your beneficiaries just need to present a certified copy of the death certificate and their identification to the bank, and the money or securities are theirs...
Read MorePosted On: February 27th 2020
No one said estate planning is easy, and this is especially true if you have a “blended family.” The good news is that there are two trust types — a qualified terminable interest property (QTIP) trust and an irrevocable life insurance trust (ILIT) — that can provide for your children from a previous marriage while also taking care of your current spouse and any children from your current marriage...
Read MorePosted On: February 13th 2020
A financial power of attorney can be a valuable planning tool. The most common type is the durable power of attorney, which allows someone (the agent) to act on the behalf of another person (the principal) even if the person becomes mentally incompetent or otherwise incapacitated....
Read MorePosted On: February 6th 2020
For 2020, the lifetime gift and estate tax exemption has reached a whopping $11.58 million ($23.16 million for married couples). As a result, few people will be subject to federal gift taxes...
Read MorePosted On: January 23rd 2020
Virtually everyone needs an estate plan, but it isn’t a one-size-fits-all proposition. Even though each person’s situation is unique, general guidelines can be drawn depending on your current stage of life...
Read MorePosted On: January 16th 2020
Virtually everyone needs an estate plan, but it isn’t a one-size-fits-all proposition. Even though each person’s situation is unique, general guidelines can be drawn depending on your current stage of life...
Read MorePosted On: January 2nd 2020
If, like many people, your traditional IRA holds a mixture of deductible (after-tax) and nondeductible (pretax) contributions, it’s important to track your contributions carefully to avoid double taxation of distributions. Why? Because the IRS treats distributions as a blend of pretax and after-tax dollars. If you treat distributions as fully taxable, you’ll end up overpaying...
Read MorePosted On: December 26th 2019
The Tax Cuts and Jobs Act created a new program to encourage investment in economically distressed areas through generous tax incentives. The Qualified Opportunity Zone (QOZ) program relies on investments in Qualified Opportunity Funds (QOFs) — funds that can provide wealthy taxpayers with some new avenues for estate planning...
Read MoreIf you’re an art collector, it’s critical for your estate plan to address your collection separately from other types of assets. Investments in artwork may be motivated in part by financial gain, but for most collectors the primary motivation is a passion for the art itself...
Read MoreIf you have a family member who’s disabled, financial and estate planning can be tricky. You don’t want to jeopardize his or her eligibility for means-tested government benefits such as Medicaid or Supplemental Security Income (SSI)...
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