Blog
Apr
It’s one of the most stunning biological facts: Women, throughout the world and regardless of factor, tend to outlive men. As the BBC’s David Robson writes:
In 1800, life expectancy at birth was 33 years for women and 31 years for men; today it is 83.5 years and 79.5 years, respectively. In both cases, women live about 5% longer than men.
You can explore the potential scientific and biological reasons for this in Robson’s article, but from a will planning and estate planning standpoint, it brings up an important point: Women, on average, are the ones who have to more often work through the details of an estate plan.
But incredibly, according to this 2014 Forbes article, 51% of Americans ages 51 to 64 don’t have a will. That’s a lot of potential heartbreak if state laws have to determine what happens to everything the deceased leaves behind (and what everyone has to work through – including probate – in the absence of a will).
Put the two numbers together, and the notion of women having a bit more of a vested interest in checking “Create estate plan” off the family’s to-do list makes perfect sense.
Many people have had the unfortunate experience of struggling to take care of a parent who has lost a spouse. But without proper planning, it can be made more stressful – and lonely – for those involved when there is no provision spelled out. With changes to the tax code, brackets, and maximum limits on the rise, having an estate planning attorney take a look through any needed changes on your documents – or create your initial plan – is the safest best you can make.
Apr
Before you sell any real estate, you should contact us. Why? Because we can often help you avoid all of the tax on the sale!
We use techniques that can allow you to sell the real estate and either defer the tax or eliminate the tax altogether. We are your Tax Lawyers.
Whenever you sell real estate, you may have gain on the sale. This gain can result from selling the property for more than you bought it for because the property has appreciated in value. However, you can also have gain even if the property value has not increased in value or has even gone down in value. For example: Rental property, both residential and commercial, provide gain because you are taking depreciation deductions.
The gain on the sale can be taxed as capital gains income with a rate of about 25%, federal and state, or some of the gain can be taxed at ordinary income rates as high as 45% federal and state.
This tax is the bad news.
The good news is you can do proper planning and avoid the tax altogether – because we can help you avoid it!
We use tools that can allow you to sell the property without tax and invest in other real estate you control and manage. But even if you are selling partly because you are tired of managing real estate, there are still tools that allow you to defer or avoid tax and escape the hassles of real estate management altogether.
The planning to avoid tax on sale of real estate is part of a careful estate plan to make sure the tax savings are preserved for your spouse and other family members.
If you have already sold your estate, we cannot help. But we can help avoid that tax if you contact us before the sale.
So, if you are planning on selling real estate – contact us early! We can help you keep those taxes rather than pay them to Uncle Sam.
Mar
Your pets are a part of the family. There’s fond memories, laughs, lots of time spent talking back and forth – and you have a soft spot for them, whether a cat, dog, fish, horse, lizard, or other pet.
What happens to them after you pass away?
It’s up to you.
You can designate specific caretakers – such as a family member, friend, or trusted no-kill shelter that can find them loving homes – and provide funds to ensure they are provided for long after you’re gone through pet trusts and other means.
Many people don’t, however. And with so many details to take care of upon someone’s passing, it can be very easy to forget about the pets, leaving their future in limbo. Leaving the decisions as a matter of probate puts undue pressure on the rest of your family or other beneficiaries, and many times, they simply don’t have the means to take in another animal or two.
Post-Gazette.com featured an article on the subject in October, which provides excellent illustration of the need to think for your pets – and how it’s not an uncommon question for those engaging in estate planning and thinking through their wills!
“If someone elderly ends up in a nursing home, their dog or cat often goes to a shelter and hasn’t been provided for,” says Marianna Schenk, a Bala Cynwyd estate lawyer.
“A lot of people just die without a will. Whoever settles their affairs may not want the animals. That’s very sad. It’s better to make a provision in your estate for your pets.
“Friends or children may not want your dogs – even though they may want everything else.”
If you want to ensure your pets are thought for, contact us – and feel free to ask about our pets, too. We love talking about them, just like you!
Mar
You’ve likely heard the phrase power of attorney before, especially if you’ve had any experience with estate planning. But there are some nuances of what a durable power of attorney (DPA) can actually provide – and making sure all of the needed documents are in place for you is what’s essential.
For instance, we write a DPA for property management. This specifies who’s allowed to maintain your finances if you become incapacitated. These finances can range from paying the mortgage and other bills to directing how your savings should be used if medical expenses arise. Ultimately, that person should be great with their own finances and someone you’d trust with your life.
Without a DPA in place for property, the courts have to decide who handles the finances, and it can be expensive – plus, takes time you may not have. Just because you may be married also doesn’t cover it, because his/her name may not be on an account or legal jurisdiction prevents access to certain finances.
Similarly, there is a medical-focused DPA that aims to identify the primary decision-maker for your medical care, should you become unable to make those choices yourself. This advanced health care directive can also provide your desired instructions on what you would like to be done for your own care. Your stated point person – often referred to as an agent or surrogate – follows those directions as much as possible.
Both durable power of attorney types are important to fully provide direction and avoid costly delays in decision-making processes. We as estate planning lawyers in Aiken and Augusta have experience in both, and are happy to answer any questions you may have.
*Note: If you’ve had a power of attorney written by another law firm, or had a document related to it signed before 2012, it is likely in your best interests to contact us for a review. Laws have changed in the past few years, and your documents need to be in compliance.
Alternatively, you can also sign up for one of our free workshops and bring your questions there – we’re more than happy to be of service in any way we can!
Feb
You work hard; in fact, without your long hours, weekends poring over figures, and unwavering commitment to supporting yourself and your loved ones, the small business you’ve built and established wouldn’t exist.
You won’t take unnecessary risks to put that work in jeopardy, either – instead, risks are calculated before deciding if expansion, carrying a new product, or opening a new location is the best option moving forward.
One unnecessary risk many small business owners haven’t thought of: A lack of an estate plan that covers your business.
Per this Entrepreneur article:
As a business owner, it’s quite likely that a significant portion of your wealth–and your family’s source of income after your death–is tied up in the family business. The success of your estate plan is dependent upon the business being transitioned to the next generation or sold to someone outside the family for a fair price. Either result takes years of planning and preparation, sometimes as much as 10 years.
Even if the business will end when you are unable to run it anymore (known as an “owner-dependent” business, implying the business runs as long as the owner is working at the business), there are still probate and tax issues worth thinking through with a qualified estate planning attorney.
Many businesses, however, are intended to be passed on – whether to another owner or a family member. This business interests require a different planning approach to facilitate a smooth transition of the business ownership. In addition, estate taxes levied on the business’ value can be costly – another reason a strong estate plan is necessary to comb through your assets, debts, etc. and create a plan that keeps the most money within the family.
No matter what the situation is with your small business, we can help you plan accordingly to make the best future possible – for employees, family members, and the business itself.
Feb
With anything relating to your family’s long-term security, there is no “set it and forget it” method that guarantees everything will be optimal. Your estate plan, much like many other aspects of your life planning, need a checkup every few years.
We typically recommend our clients come in every three years for a thorough look-through of their estate plan. There are two strong reasons why:
Laws change. Every year, state and federal laws receive updates, so it’s good to be sure everything you’ve set out takes full advantage of opportunities to avoid unnecessary taxes on your belongings.
People change. Whether it’s relationships, health, financial situation, or something else, your family won’t be the same in three years as it is now. Perhaps a different person would make most sense as a potential executor of your estate now than three years ago. Or, maybe you welcomed a new grandchild into the world and want to set aside something to help with future expenses (like college). Now’s the chance to do that!
For your estate plan checkup, there are a few areas we focus on. Your existing documents, such as wills, power of attorney, and trusts, all need to be examined to ensure the right people are given the right authority. It allows you to make updated decisions based on any changes in your family or medical history.
Next, we’ll review your assets – from personal possessions to real estate, vehicles, and more. This ensures everything is thought of, and anything new (like a condo on the beach or trust fund you’ve started) is thought for.
We also take a look at policies like life insurance and double-check your fiduciaries on each.
If it’s time for you to review your estate plan, then contact us today – we’ll be happy to help!
Jan
Congratulations! You’re expecting a new addition to your family, and it’s bringing a lot of change in many facets of your life.
As estate planning lawyers, we’re prone to think long-term about big life events such as the birth of a child.
And the answer to the question “How do I plan well?” is easy: Go through your estate plan and ensure your child is provided for, no matter what happens in the coming years.
You can designate funds to be placed in a few different types of trusts such as a 529 plan, to reduce any potential tax burden on what they receive. Appointing a guardian, thinking about life insurance to cover the financial needs they would have received, and establishing a plan for your retirement benefits are just some of the items you’ll want to consider writing into your will. These details can be adjusted as the child grows older, and we do typically recommend a review every three years to keep all of the small details in order for your small blessing!
For adult children, decisions typically revolve around how much you want to leave for each child. This can be done in installments, as a lump sum, through a trust, or other various measures.
We understand there’s a lot of change going on – and that’s why we’re here to make the future easily navigable, allowing you to focus your attention on making the most of the present. If you have any questions, feel free to send us an email, call us, stop by, or plan to attend one of our free monthly workshops. We’ll be more than happy to assist in any way that we can in ensuring your child’s future!
Jan
What happens to your Facebook account if you pass away? Or those photos you uploaded years ago? Do you write a blog that brings in a measure of advertising revenue?
An estate plan can plan for those – and many more – contingencies.
Wells Fargo recently wrote an excellent article entitled “Do you have a digital estate plan for your online assets?” One quote stands out as showing the need for you to plan well:
“Only 10 U.S. states [Connecticut, Delaware, Idaho, Indiana, Maine, Nevada, New Jersey, North Carolina, Oklahoma, and Rhode Island] have passed any digital estates laws,” says Evan Carroll, co-author of Your Digital Afterlife.
While some online sites have rules in place – Facebook is one, with an option to designate who can access your account upon your death – but many have nothing at all. Whether it’s simply a photo or former blog post, or thousands of frequent-flyer miles accrued and never used, a digital estate plan can ease the burden of navigating the complex and rather untested world of who-owns-what online.
There’s enough burden to handle upon the passing of a loved one. That’s why considering every possible angle on your estate plan is important, to ensure everything – including your online presence – is accounted for and thought through.
If you have any questions, don’t hesitate to contact us and ask!
Dec
According to Charity Navigator, 12% of all giving to charities is done on the last three days of the year. That’s a lot of last-minute charitable giving to have a tax write-off in a few months.
For an estate plan, however, it requires much more foresight. Charitable giving involves some estate planning techniques to maximize your donation. For instance, we could setup a Charitable Remainder Trust, which may help lower estate taxes and also help your preferred charity of choice.
We understand now is a time of cheer and celebration. We can’t wait to enjoy spending time with our own families and friends, as well!
We also recognize the loved ones you’re celebrating with this holiday season are those you want the best for – and that’s why we’re here, to help you ensure the best for them down the line. It’s worth noting the estate tax credit for an individual is $5.43 million, and it’s double for a married couple. Thus, many charitable giving trust options may not be necessary for you.
But when you get a moment, send us a note and we’ll be happy to talk through charitable giving with you at your convenience. Until then, have a wonderful holiday!
Dec
Each year, rules change – and the same it true for tax laws governed by the IRS. Adjustments are made every year, and those can have dramatic impact on your estate plan.
For instance, the IRS has made it easier in recent years to designate one trust fund for all surviving heirs in particular situations. USA Today ran a September 2015 article on the subject, but just because a new option is available doesn’t mean it’s the best option for YOU.
In addition, the IRS itself has yearly updates, such as these, that are posted near the end of the year. They impact the next year’s tax filing, but can impact your estate plans if you haven’t met with an estate planning lawyer to ensure your plans are up to date.
That’s why we strongly recommend those with already-existing estate plans to review them with us. We typically recommend our clients to come in once every three years so everything is kept up to date.
If it’s time for you, then have a read through the article links above, then contact us to schedule your review.