No one likes to think about being incapacitated, but the threat is quite real. According to recent statistics, in the United States, about one out of every 10 people age 65 or older are affected by Alzheimer’s disease, while roughly one-third of the adult population has at least one of the leading risk factors for stroke. Don’t think that you’re immune.
This raises some troubling thoughts about how your personal and financial affairs will be handled in the event you’re incapacitated. If you haven’t already done so, address the possibility as part of a comprehensive estate plan. One common solution is to create a power of attorney. The optimal protection is afforded by a durable power of attorney. (more…)
Generally, every estate plan requires a will, but this main attraction may be complemented by other documents, like a letter of instructions. The letter, unlike a valid will, isn’t legally binding but can be valuable to surviving family members.
If you haven’t done so already, draft a letter of instructions and, most importantly, make sure that others know where and how to locate it. (more…)
George was a successful entrepreneur. He accumulated significant wealth during his lifetime, including several real estate parcels, a wide array of securities, retirement plan accounts and IRAs, and various collectibles, in addition to the home he owned jointly with his wife, Theresa. He also took out several life insurance policies on his life.
In his will, George designated Theresa as the beneficiary of most of the assets but divided up some of the other property between his two children. George named his wife and children as equal beneficiaries on life insurance policies. Sadly, George died earlier this year. (more…)
The digital revolution has touched virtually every aspect of our lives. The result is that you likely have at least a handful of “digital assets.”
These assets may include personal assets, such as online bank and brokerage accounts, and business assets, such as your company’s website, domain name, client databases and electronic invoices. As with all your assets, you need to account for them in your estate plan. (more…)
The Setting Every Community Up for Retirement Enhancement (SECURE) Act is the biggest retirement planning law in decades. However, when all is said and done, the new law may have just as significant an impact on estate planning, especially if younger individuals are in line to inherit IRAs or qualified retirement plan accounts.
Key SECURE Act provisions
The SECURE Act includes noteworthy provisions for both individuals and businesses. Let’s focus here on a summary of the key tax law changes for individual retirement-savers. (more…)
Trusts come in all shapes and sizes. However, from an income tax perspective, there are basically two types: grantor trusts and nongrantor trusts. Generally, with a grantor trust all trust income is taxed directly to the grantor — the person establishing the trust — and assets in the trust may or may not be included in the grantor’s estate. (more…)
One of the outcomes of the Tax Cuts and Jobs Act is that children with unearned income may find themselves in a higher tax bracket than their parents. This is because, under the “kiddie tax,” as it’s sometimes referred to, a child’s unearned income is taxed according to the tax brackets for trusts and estates, under which the highest tax rates kick in at far lower income levels. The good news is that there are strategies to allow for family income shifting. (more…)
If you’re the parent of a newborn or toddler, you may be thinking about naming a guardian for your child. This can be a difficult decision, especially if you have a plethora of choices or, on the other hand, no one you can trust. Or perhaps you plan on petitioning the court for guardianship of a child. In either event, you must adhere to the legal principles under state and local law. (more…)
A buy-sell agreement provides for the disposition of each owner’s business interest after a “triggering event,” such as death, disability, divorce, termination of employment or withdrawal from the business. However, to be effective, the agreement must include the appropriate provisions.
It also should be part of your estate plan if you have an interest in a family-owned or other closely held business. (more…)