Giving Your Heirs “Lifetime Gifts” Can Benefit You During the Estate Planning Process

Wheaton wills and trusts lawyersIf estate plans were only about money, they would not be so difficult to create. Instead, parties must first come to terms with their own eventual death, and they must consider where and how they would like money to be distributed. Since family matters can be highly complex and sometimes volatile, and the rules for handling assets upon one’s death can vary by type and situation, such decisions regarding inheritances can be more than just difficult. One possible solution is to use “lifetime gifts” as your guide. Learn more in the following sections, including how our seasoned estate planning attorneys can help with drafting your initial estate plan. 

What is a Lifetime Gift?

Lifetime gifts are often used as an estate-planning strategy for reducing federal and state taxes, which means they are most commonly used in estate plans that exceed either the $4 million Illinois state estate tax exemption or the $5.5 million federal estate tax exemption. Each gift, which may equal up to $15,000 in value each year ($30,000 maximum for married couples giving a joint gift), reduces the value of the estate, thereby reducing the amount that heirs will be taxed when they inherit it. Lifetime gifts can do more than simply lower the tax load of one’s estate, however. They can also benefit the guarantor during the estate planning process. 

Using Lifetime Gifts to Aid You in Estate Planning

One of the biggest struggles that guarantors face is deciding how to distribute their wealth among heirs. Some are not even sure if the total value of the estate should be divided equally among children, or if personality and spending habits be considered when deciding how much to give a specific heir? Those who are considering the latter may use lifetime gifting as a part of their estate planning strategy. 

Consider this example: You have two children – one that has always been responsible with money and life decisions, and another that usually spends money frivolously and seems to struggle with making good and healthy life decisions. Perhaps the latter has made attempts to improve things, so you want to leave them an inheritance. Yet, because of their history with money, you are concerned that they will squander whatever you leave to them. A lifetime gift, given to them with conditions, can help you determine how well they might handle an inheritance. You can also give lifetime gifts to extended family members that you may not know very well to determine how they might handle any wealth that you decide to leave them. 

Contact Our Wheaton Estate Planning Attorneys 

Lifetime gifting is just one of many strategies that guarantors can use during the estate planning process. Stock, Carlson, Oldfield & McGrath, LLC can assist you in using it, as well as any others that may serve your needs. Schedule a consultation with our DuPage County wills and trusts lawyers by calling 630-665-2500 today. 

Sources:

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=609&ChapterID=8

https://www.irs.gov/businesses/small-businesses-self-employed/estate-tax

 

Single and Retired? Try These Strategies When Creating Your Illinois Will or Trust

DuPage County wills and trusts lawyerWhile those who are married or have kids typically have a built-in plan, should anything happen to them, singles rarely have this option. As such, they may find themselves incapacitated or ill with no one to protect their interests. Even worse, if they pass away, their entire life’s earnings could be lost. Thankfully, there are ways that single people can protect themselves from such a fate. Learn more, and discover how a seasoned will an trust lawyer can assist with the process. 

Examining the Role and Responsibilities of a Proxy or Trust

A trust or proxy is someone who makes medical, financial, or estate decisions for an incapacitated or deceased party. Used by single and married people alike, this person must be appointed by the individual in question ahead of time, and their roles and responsibilities must be clearly outlined. These may include:

  • Financial responsibilities – Making decisions on behalf of the individual and handling of their finances, should they become incapacitated; 
  • Healthcare responsibilities – Making medical decisions if the individual becomes incapacitated; and
  • Will or trust executor responsibilities – Handling of the estate and final expenses, should the individual pass away.

Ensuring Your Proxy is Prepared for Their Role

Your will or estate plan can be as simple or comprehensive as you like, but keep in mind that your proxy only knows what you tell them. For example, if you do not want to have excessive measures taken to keep you alive, you must outline this in your will or estate plan. Additionally, if you only want your proxy to handle certain aspects of your estate, you will want to ensure this is clearly stated and explained. Of course, it can be difficult to plan for all scenarios, especially on your own. As such, individuals are highly encouraged to seek legal counsel when drafting their will or estate plan. 

You will also want to ensure that your proxy has all the information they need to handle their responsibilities (i.e. passwords for online banking, credit cards, and online banking), and they will need a list of your debts and assets, along with a copy of your passport and information on any insurance policies you may have. This information can be placed in an envelope and given to your proxy. Just be sure to also supply your attorney with a copy, and update the information anytime something changes. 

Contact Our DuPage County Estate Planning Lawyers

With more than 40 years of experience, Stock, Carlson, Oldfield & McGrath, LLC has the knowledge and skills to help ensure your estate plan is created with your best interests in mind. Schedule your personalized consultation with our DuPage County estate planning lawyers to learn more. Call 630-665-2500 today. 

Source:

http://www.fox5atlanta.com/news/i-team/estate-emergency-planning-for-single-people

 

No Children? Do Not Skip the Estate Planning Process

Joliet wills and trusts lawyersPeople who do not have children often assume that their assets will go directly to their spouse, so an estate plan is not needed. Unfortunately, nothing could be further from the truth. Learn why it is still important that you consider the future of your estate, even when you do not have children, and discover how an experienced wills and trusts lawyer can assist you with the development of your estate plan.

What Happens to Assets When You Do Not Have an Estate Plan?

When someone dies without a valid will or trust in place, their assets typically go to their spouse. Unfortunately, there are situations that could prevent them from obtaining the assets. Examples include an ex-spouse that is still listed as a beneficiary on a retirement plan and probate challenges from extended family members who were not intended beneficiaries.

If the individual does not have a spouse, the courts may assign a trustee to the estate until beneficiaries can be found. If there are multiple beneficiaries, the matter may go to probate. In this instance, the value of the estate may be depleted once it reaches the beneficiaries. Thankfully, both issues can be prevented with a well-crafted estate plan.

How an Estate Plan Protects Your Assets After Death

Rather than allowing your estate to be handled by the courts and the trustees it assigns, you can draft a comprehensive estate plan that outlines your final wishes. Doing this not only helps to eliminate any confusion about where your assets should go, but it also reduces the risk of some of the more common after-death estate issues, and it decreases the chances that your estate will go to probate.

You can also name alternative beneficiaries in your estate plan. This reduces the risk of your assets going to unintended parties if your primary beneficiary passes away before your estate can be distributed. An example of this happening would be if your spouse died shortly after you did. If neither of you had an estate plan, the assets might then go to your spouse's family, rather than your own.

Contact Our DuPage County Wills and Trusts Lawyers

At Stock, Carlson, Oldfield & McGrath, LLC, we work with individuals to help ensure that their wishes are carried after death. Dedicated and experienced, our DuPage County wills and trusts lawyers can assist you in creating a comprehensive estate plan that suits your needs. Schedule a personalized consultation to get started. Call 630-665-2500 today.

Source:

https://money.usnews.com/investing/articles/2017-02-16/estate-planning-is-important-for-people-without-children