As much as we don’t want to think about our own demise, there is that risk every day. We all know too well that unforeseen events can happen at any time. Wouldn’t you feel better knowing you have your overall estate plan in order just in case? Please keep these tips in mind.
- Have an estate plan. Don't leave a mess for your survivors and have the courts or state decide things for you. To develop your plan, your estate planning team should include more than your attorney, such as a financial planner, accountant, and insurance agent.
- Realize that estate planning is about more than just your will or saving estate taxes. It's also about making sure assets would flow the way you intend, plans are in place should you become incapacitated and that there are no unintended consequences.
- Understand the effect the current federal and state estate tax law have on your situation and don’t let uncertainty stall the estate planning process.
- Check off that you have a current will, power of attorney, health care proxy, living will, possibly certain lifetime trusts, and beneficiary designations naming both primary and contingent beneficiaries.
- Follow through to fund trusts formed during your lifetime (revocable trust, life insurance trust. children’s trusts) so they can accomplish their objectives.
- Take advantage of lifetime gifting opportunities to reduce your taxable estate without incurring a gift tax. Consider larger gifting strategies if needed. First be sure you can afford to gift.
- Coordinate your estate plan with your buy/sell agreement and insurance funding to make sure things would work as intended.
- Consider whether charitable giving techniques during lifetime vs at death make sense to reduce your estate while also giving you an income tax deduction.
- Coordinate legal documents and beneficiary designations if you have a child with special needs or a spouse on Medicaid.
- Every two to three years, have your estate planning team review your estate plan to make sure it encompasses your whole picture, so that you not only understand how all the components come together in determining how your assets would be distributed to your heirs upon your death, but that you also understand the financial and tax impacts of your estate plan as well—protecting yourself from unintended consequences.
Cindi Turoski is a managing member of Bonadio Wealth Advisors based out of our Albany, NY office.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.