As an attorney who has prepared numerous estate plans, I would like to communicate “estate planning truths”.
Estate Planning Truths: MISINFORMATION IS ABUNDANT.
I am often surprised by the misinformation circulating about estate planning. The misinformation takes away from the actual understanding why an estate plan is valuable. Misinformation keeps us from seeing why we may want an estate plan. Finally, misinformation makes acquiring estate planning seem more difficult and more expensive then It actually is.
WHAT IS ESTATE PLANNING?
Many people believe that estate planning involves minimizing estate taxes when you die. While it does that, it also does much more. Actually, planning for estate taxes is rarely done these days. The current exemption on estate taxes is over $5,000,000.00 and twice that for a married couple. Obviously, only an incredibly small number of estates will be subject to the estate tax under these circumstances. Estate planning, however, does involves deciding who you want to receive your property when you die. Many people think their property solely consists of their house and if they don’t have a house, they really don’t have any property. Of course, that is not true; your property consists of virtually everything you own including life insurance policies, jewelry, furniture, artwork, bank accounts, retirement plans and any other type of asset that you might have. It may include your business. With proper estate planning, you may get to make the decision about what happens to your things rather than the State of Texas. Estate planning also allows you to consider your liabilities. Does that house have a mortgage on it? Is there a lien on the cars? Is there bank debt? Do you own a business that still needs to be operated? If there is debt on a particular piece of property, do you want it to be the liability of the person getting that property or the estate? These are all considerations in estate planning.
From the IRS October 28, 2016:
tes with combined gross assets and prior tax 0 for decedents dying in 2009; and $5,000,000 or more able gifts exceeding $1,500,000 in 2004 – 2005; $2,000,000 in 2006 – 2008; $3,500,00for decedent’s dying in 20 Most relatively simple estates (cash, publicly traded securities, small amounts of other easily valued assets, and no special deductions or elections, or jointly held property) do not require the filing of an estate tax return. A filing is required for esta10 and 2011 (note: there are special rules for decedents dying in 2010); $5,120,000 in 2012, $5,250,000 in 2013, $5,340,000 in 2014, $5,430,000 in 2015, $5,450,000 in 2016, and $5,490,000 in 2017.
HOW DOES AN ESTATE PLAN AFFECT MY FUTURE?
An estate plan will involve making decisions about what happens should you become incapacitated later in life. Who do you want to handle your money? Who do you want to make medical decisions for you? Who do you want to make any other decisions that have to be made. With proper estate planning, it is possible to avoid an expensive guardianship should those circumstances arise. What happens if a guardianship is still necessary? Most well-thought out estate plans will allow you to designate who you would prefer your guardian to be and, sometimes more importantly, who you do not want it to be. That sends a strong message to the guardianship judge as to what you would prefer to do. Many estate plans involve signing a directive to physicians, sometimes called a living will. This allows you to make a decision as to whether or not you want to be artificially kept alive if you are not able to make a decision while you are in an irreversible or terminal condition with little time to live.
HOW DOES AN ESTATE PLAN BENEFIT MY LOVED ONES?
A person may have relatives that can’t agree on everything, and those people might want to designate what is to be done with their remains. Who is to make funeral decisions for them. Often if we don’t make those decision ahead of time, it will likely lead to a messy, expensive fight in the future for those we actually would want comforted.
HOW WE SIMPLIFY THE PROCESS?
At Bob Leonard Law Group we have a well-thought out estate planning questionnaire and a list of what you will need. We cover all the bases and then produce the legal documents that covers your circumstances and desires. We make estate plans simple, legal and affordable.