When Is It Time to Write Your Will?

DuPage County trusts and wills attorney, living will, time to write your will, when to write your will, will writingFor most people, the thought of sitting down to write a will is somewhat unnerving. It requires thinking about a time when one is no longer alive, which is understandably difficult. According to the AARP, close to half of Americans age 45 and older have not yet written their will. Though it may be hard for some, taking the time to plan and write out a thorough will can save a family time and money.

Determining the “right” time to compose a will is not the same for everyone. Since a will must contain current information, it is a document that requires constant updates. Instead of searching for a specific age when writing a will is most appropriate, it makes more sense to view it as a periodically updated document.

After Acquiring Property, Assets or Financial Changes

Without a legal and updated will, making sure the beneficiaries receive what is rightfully theirs can be difficult. This is why it is absolutely critical to keep all information regarding assets and property in a will.

For some, it is easier to think about a will representing one’s current financial standing and worth—as opposed to a document that is only important after passing. A proper will should read like a thorough catalog of one’s property and identify who is to inherit what after death.

After Marriage

For many, marriage is more than a happy occasion; it is also a time to update or start writing a will. If one spouse should die, it is important for the other to know what he or she will inherit.

Marriage is also a time when people purchase property and when ownership may change or adapt. These are changes that a will must document.

After Having Children

Having children is another moment when it is appropriate to update a will. Without an updated and valid will, children can spend thousands of dollars in legal expenses to secure what their parents had initially planned to pass on to them.

Contact a Trusts and Wills Attorney for Assistance

If you feel it is time to write your will and would like the assistance of an experienced DuPage County trusts and wills attorney, contact Stock, Carlson, Flynn and McGrath, LLC. Call 630-665-2500 today to schedule a consultation.

Estate Planning Guidelines When you Have a Non-Citizen Spouse

resident alien, Illinois estate planning lawyer, estate planning, estate tax, Standard estate planning tax advice might not work for situations in which one or both spouses are resident aliens. The term resident alien is used by the U.S. government to describe non-citizens who are permanent U.S. residents, and it could be beneficial for those in this circumstance to get some guidance from an estate planning attorney.

Under federal tax law, resident aliens and American citizens are governed by the same estate tax rules. In cases where the taxable estate assets are above $5.34 million, the IRS will want 40% of those excess funds. With careful planning, the implications of the federal estate tax can be avoided or minimized.

U.S. citizens are eligible to take advantage of the unlimited marital deduction, which allows for as many tax-free transfers to your spouse during your lifetime as you would like. Unfortunately, non-citizen spouses can’t take advantage of this program. This can be a big hit when it comes to the estate tax, since the IRS will always want to go after 40% of the excess.

There are several solutions to this issue if you are already married to a non-citizen. First, your spouse can become a citizen. This can even occur after you have passed away provided that it is done before the due date for your federal estate tax return, allowing your spouse to reap the rewards of the unlimited marital deduction.

Second, you can reduce your taxable estate by making big gifts to your spouse while you are alive- married couples can transfer $145,000 to one another in 2014. Finally, you could set up a qualified domestic trust, deferring the federal estate tax on any assets inside until your spouse removes them or passes away.

As you can see, estate tax planning with a non-citizen spouse can be complicated, but there are opportunities for you to reduce the federal estate tax. Consult with an Illinois estate planning attorney today for more details.

DOMA and Estate Tax Planning

On Wednesday June 26th, the United States Supreme Court ruled five to four that the Defense of Marriage Act is unconstitutional.  The definition of marriage will now change to reflect the diversity of human life.  There will also be far reaching affects concerning married couples when they plan their estates.

The first change concerns the tax break afforded to married couples which was the issue in the United States v. Windsor case.  This is defined as the marital deduction which lets spouses that are US citizens transfer assets to each other without paying gift taxes or other federal taxes.  But that was not the case for same sex couples because they could not be married under federal law.  That is because under section three of DOMA, marriage is defined as the “legal union between one man and one woman” while a spouse is defined as a “person of the opposite sex who is a husband or a wife”.

In 2009, Edith Windsor lost her spouse of 44 years Thea Spyer.  The couple was married in Canada but it was not recognized by the United States.  When Windsor’s inheritance was above the gifting limit of $3.5 million at the 45 percent tax rate, the inheritance was taxed over $350,000.

In New York, Windsor filed a lawsuit seeking a refund of that taxation.  She believed that DOMA’s definition of “marriage” and “spouse” violated the Constitution.  Specifically, the Equal Protection clause or 14th amendment provides that “no state shall…deny any person within its jurisdiction the equal protection of the laws”.  This opinion was held by lower courts, appeals court and now the Supreme Court of the United States.

Now the marital deduction is available for same-sex couples along with other estate planning benefits.  This includes portability of unused tax exclusions, gift-splitting, and  rollover rights.  If you want more information about these tax planning tools or how to plan your estate, contact an experienced estate planning attorney in Wheaton today.

image courtesy of  Stuart Miles / freedigitalphotos.net