The new year brings new tax laws, and new policies may give reason to adjust estate planning documents. The major change is the raising of the threshold for the estate tax, and those individuals who will be affected by the change will likely want to review estate documents. For most people in California, wills and trusts benefit from frequent review, with updates whenever there is a major life change.
For married couples, federal estate taxes apply only to those with accumulated assets in excess of $22 million. This doesn’t mean that most individuals wouldn’t benefit from an estate plan, however. An important aspect of estate planning has to do with financial health while one is still alive, and how one chooses to pass along any assets after death. Each state sets its own procedures as to how property and funds are routed after a person passes away, and unless the person designates another way to do so, state law will determine the outcome.
In case one becomes incapacitated, one should have power of attorney and health care directives in place. After any life changes, a person may also wish to update beneficiaries on bank and investment accounts. Trusts can also provide protection for assets for individuals with special needs or in the case of multiple marriages or non-traditional relationships.
A will is a great way to keep control of how one’s assets are distributed even after one dies. Wills, trusts and other estate planning documents can be very useful to a person in California who has specific preferences for the distribution of their assets, but creating the document can be a challenge for some. An experienced estate planning attorney can offer guidance for individuals with more questions about the process.
Source: startribune.com, “Your estate plan needs an update, even if it is new,” Beth Pinsker, Jan. 20, 2018
