Five Reasons To Plan Your Estate Now
1. Reduce Estate Tax. It was fully expected that before 2011 arrived, Congress would pass laws to “fix” the Federal estate tax but they didn't. This means anyone passing away before December 31, 2010 can pass an unlimited amount of wealth to their loved ones without a tax to the Federal government at all. If you wake up on January 1st you can only pass $1 million without an estate tax when you pass away. Any amount over $1 million is subject to an estate tax of up to 55%. This will likely impact you and your family.
2. Name Guardians For Minor Children. Clearly, the future of your children is extremely important. In your absence, perhaps nothing is more important than who will watch over them. You can only nominate guardians for your minor children in a properly drawn Will.
3. Choose The Timing And Circumstances Of Distributions. Deciding who should receive your assets is the easy part. Deciding how and when they should receive the assets is much more important and more challenging. Usually, leaving assets outright to your beneficiaries is not the best way. By holding the assets in trust, you can protect those assets from your beneficiaries' creditors and future ex-spouses. Also, you can mete out the assets over time so that your beneficiaries can get maximum use of the assets, without the opportunity to squander the assets.
4. Make Provisions For Heirs With Special Needs. Children and other loved ones with special needs require extra attention during life. Estate planning for them is no different. What might work for someone without special needs might not work for someone with those needs. By planning effectively, you can help make sure your assets go for the use of the special needs beneficiary yet do not disqualify them from receiving government assistance such as Medicaid.
5. Choose Who Will Make Decisions For You If You Are Disabled. People often think that estate planning only includes planning for what happens at your death. However, a major aspect of estate planning is addressing what is to happen in the event of your incapacity.
The reasons for doing estate planning are as numerous and as unique as we are as individuals. However, we all want to make sure that we and our families are taken care of in times of need. A qualified estate planning attorney can help you come up with a plan that achieves your goals, both personal and financial.
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