Articles & Information

Don’t be afraid of probate

Posted On: November 27th 2019

The word “probate” may conjure images of lengthy delays waiting for wealth to be transferred and bitter disputes among family members. Plus, probate records are open to the public, so all your “dirty linen” may be aired. The reality is that probate doesn’t have to be so terrible, and often isn’t, but both asset owners and their heirs should know what’s in store...

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Flex plan: In an unpredictable estate planning environment, flexibility is key

Posted On: November 14th 2019

The Tax Cuts and Jobs Act (TCJA) made only one change to the federal gift and estate tax regime, but it was a big one. It more than doubled the combined gift and estate tax exemption, as well as the generation-skipping transfer (GST) tax exemption. This change is only temporary, however. Unless Congress takes further action, the exemptions will return to their inflation-adjusted 2017 levels starting in 2026...

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BDIT lets you give away property without losing control

Posted On: November 7th 2019

By temporarily doubling the gift and estate tax exemption, the Tax Cuts and Jobs Act (TCJA) opened a window of opportunity for affluent families to transfer assets tax-free. To take advantage of the higher exemption amount, many families that own businesses or other assets worth more than the pre-TCJA exemption amount are planning substantial gifts to their children before 2026...

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The net investment income tax is alive and well: How it can affect your estate plan

Posted On: October 31th 2019

The Tax Cuts and Jobs Act (TCJA) reduced individual income tax rates, but it left the 3.8% net investment income tax (NIIT) in place. It’s important to address the NIIT in your estate plan, because it can erode your earnings from interest, dividends, capital gains and other investments, leaving less for your heirs...

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Don’t worry! A broken trust can be fixed

Posted On: October 24th 2019

There are good reasons why estate planning advisors recommend you revisit and, if necessary, revise your estate plan periodically: changing circumstances, including family situations and new tax laws. While it’s relatively simple to change a beneficiary, what if an irrevocable trust no longer serves your purposes? Depending on applicable state law, you may have options to fix a “broken” trust...

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Who needs an estate plan? You do!

Posted On: October 17th 2019

Despite what you might think, estate planning isn’t limited to only the rich and famous. In fact, your family is likely to benefit from a comprehensive plan that divides your wealth, protects your well-being and provides a compass for your family’s future.....

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Leave a philanthropic legacy with a charitable remainder trust

Posted On: October 10th 2019

Let’s say you’re charitably inclined but have concerns about maintaining a sufficient amount of income to meet your current needs. The good news is that there’s a trust for that: a charitable remainder trust (CRT). This type of trust allows you to support your favorite charity while potentially boosting cash flow, shrinking the size of your taxable estate, and reducing or deferring income taxes....

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Is a self-directed IRA right for you?

Posted On: October 3rd 2019

Traditional and Roth IRAs can be powerful estate planning tools. With a “self-directed” IRA, you may be able to amplify the benefits of these tools by enabling them to hold nontraditional investments that offer potentially greater returns. However, self-directed IRAs present pitfalls that can lead to unfavorable tax consequences. Consequently, you need to handle these vehicles with care.....

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Sec. 6166: Estate tax relief for family businesses

Posted On: September 26th 2019

Fewer people currently are subject to transfer taxes than ever before. But gift, estate and generation-skipping transfer (GST) taxes continue to place a burden on families with significant amounts of wealth tied up in illiquid closely held businesses, including farms....

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The Crummey trust: Still relevant after all these years

Posted On: September 19th 2019

Traditionally, trusts used in estate planning contain “Crummey” withdrawal powers to ensure that contributions qualify for the annual gift tax exclusion. Today, the exclusion allows you to give up to $15,000 per year ($30,000 for married couples) to any number of recipients....

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When it comes to asset protection, a hybrid DAPT offers the best of both worlds

Posted On: September 12th 2019

A primary estate planning goal for most people is to hold on to as much of their wealth as possible to pass on to their children and other loved ones. To achieve this, you must limit estate tax liability and protect assets from creditors’ claims and lawsuits...

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Control how your charitable gifts are used by adding restrictions

Posted On: September 5th 2019

If philanthropy is an important part of your estate planning legacy, consider taking steps to ensure that your donations are used to fulfill your intended charitable purposes. Outright gifts can be risky, especially large donations that will benefit a charity over a long period of time...

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Take intrafamily lending to the next level by establishing a family bank

Posted On: August 29th 2019

One of the primary goals of estate planning is to put in writing how you want your wealth distributed to loved ones after your death. But what if you’d like to use that wealth to help a family member in need while you’re still alive? One way to do so is through intrafamily lending. If you’re considering making an intrafamily loan to your children or other family members, it’s worth a look at establishing a “family bank.”...

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Expanded 529 plans offer unique estate planning benefits

Posted On: August 22nd 2019

If you’re putting aside money for college or other educational expenses, consider a tax-advantaged 529 savings plan. Also known as “college savings plans,” 529 plans were expanded by the Tax Cuts and Jobs Act (TCJA) to cover elementary and secondary school expenses as well. And while these plans are best known as an educational funding vehicle, they also offer estate planning benefits....

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A poorly worded apportionment clause can upend an estate plan

Posted On: August 15th 2019

Federal estate tax liability is no longer an issue for many families, now that the gift and estate tax exemption stands at $11.4 million for 2019. But there are still affluent individuals whose estates may be subject to hefty estate tax bills. If you expect your estate to have significant estate tax...

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What’s the difference between the two types of power of attorney?

Posted On: August 1st 2019

When drafting your estate plan, you and your attorney must account for what happens to your children and your assets after you die. But your plan must also spell out your wishes for making financial and medical decisions if you’re unable to make those decisions yourself. A crucial component of this plan is the power of attorney (POA)...

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Naming a trustee may be one of the most important decisions of your life

Posted On: July 25th 2019

When it comes to estate planning, trusts are appealing for many reasons. They can enable you to hold and transfer assets for beneficiaries, avoid probate and reduce estate tax exposure. But they can be complicated to set up. One of the major decisions you’ll need to make when establishing...

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Personal circumstances figure into when to begin taking Social Security

There are several individual factors that go into the determination of when the best time is to begin collecting Social Security benefits. Among those factors are the size of your estate, the amount of money you and your spouse may need to continue...

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You missed a required minimum distribution

The penalty for missing a required minimum distribution (RMD) from an IRA or qualified retirement plan is one of the harshest in the tax code: 50% of the amount you should have withdrawn. Generally, you’re required to take RMDs from traditional IRAs...

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How can you mend a broken trust? Try decanting

An irrevocable trust can be a powerful estate planning tool, but in some cases irrevocability could be a disadvantage. For example, you might discover a drafting error that makes the trust inconsistent with your original purposes...

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Now may be the time to forgive intrafamily loans

If you have outstanding loans to your children, grandchildren or other family members, consider forgiving those loans to take advantage of the record-high gift and estate tax exemption and the generation-skipping transfer (GST) tax exemption. Currently,...

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A buy-sell agreement can provide the liquidity to cover estate taxes

Posted On: July 18th 2019

If you own an interest in a closely held business, it’s critical to have a well-designed, properly funded buy-sell agreement. Without one, an owner’s death can have a negative effect on the surviving owners...

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Thinking about a Roth IRA conversion? Now may be the ideal time

Posted On: July 11th 2019

Roth IRAs offer significant estate planning and financial benefits. If you have a substantial balance in a traditional IRA and are considering converting it to a Roth IRA, there may be no better time than now. The Tax Cuts and Jobs Act (TCJA) reduced individual income tax rates through 2025…

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4 negative outcomes of jointly owning property with a family member

Posted On: June 27th 2019

A common estate planning mistake that people make is to own property jointly with an adult child or other family member. True, adding a loved one to the title of your home, bank account or other property can be a simple technique for leaving property to that person without the need for probate…

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A divorce necessitates an estate plan review

Posted On: June 20th 2019

If you’re divorcing, it’s important to review your estate plan as early as possible, for two reasons: First, you may wish to revise your plan immediately to prevent your spouse from inheriting or gaining control over your assets if you die or become incapacitated before the divorce is final. Second,…

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Ease itemized deduction limitations using a nongrantor trust

Posted On: June 13th 2019

The record-high exemption amount currently in effect means that fewer families are affected by gift and estate taxes. As a result, the estate planning focus for many people has shifted from transfer taxes to income taxes. A nongrantor trust can be an effective option to reduce income taxes,…

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You have options when addressing life insurance in your estate plan

Posted On: June 6th 2019

Life insurance has long provided a source of liquidity to pay estate taxes and other expenses. But, with the estate tax exemption currently set at an inflation-adjusted $10 million ($11.40 million for 2019), estate taxes are no longer a concern for many families. Nonetheless, life insurance offers many benefits for nontaxable estates…

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Estate Planning for Single Parents Requires Special Considerations

Posted On: May 15th 2019

Here’s a fast fact: The percentage of U.S. children who live with an unmarried parent has jumped from 13% in 1968 to 32% in 2017, according to Pew Research Center’s most recent poll. While estate planning for single parents is similar to estate planning for families with two parents, when only one parent is involved,…

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Make health care decisions while you’re healthy

Posted On: May 9th 2019

Estate planning isn’t just about what happens to your assets after you die. It’s also about protecting yourself and your loved ones. This includes having a plan for making critical medical decisions in the event you’re unable to make them yourself. And, as with other aspects of your estate plan, the time to act is now, while you’re healthy…

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Add Spendthrift Language to a Trust to Safeguard Assets

Posted On: May 7th 2019

Protecting assets from creditors is a critical aspect of estate planning, but you need to think about more than just your own creditors: You also need to consider your heirs’ creditors. Adding spendthrift language to a trust benefiting your heirs can help safeguard assets. Spendthrift language explained Despite its name, the purpose of a spendthrift…

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