With the New Year on the horizon, now is a great time to review all of your estate planning documents and get them updated. Don't let this important review pass you by-if your circumstances have changed at all you need to revise your documents. To ensure that your materials are up to date, set a yearly calendar reminder to look them over before the new year starts. If you need changes to your documents, reach out to an estate planning attorney today to get your appointment scheduled. Skipped making your will and other documents last year? Now is a great time to get your house in order.
Another reason that the end of the year is a great time to conduct an annual review on your documents is that when there are changes in federal or state law, they tend to take effect starting in January. This upcoming year is no different, as there are several changes in estate planning law that are coming in 2014. Starting in January, 2014, the amount of tax free transfers to family in a lifetime is increasing by $90,000. Doing your annual review now allows you to speak with your estate planning attorney about changes that might affect your documents or your estate.
This time of year is a good opportunity to remind relevant individuals, like your trustee or beneficiaries, where your documents have been stored. Knowing where items are makes it easier to find them but it also limits the chances of family arguments about the "right" version of your will or trusts.
Have any major life changes happened in the past year? Gotten married or divorced? Given birth, adopted, or met a new grandchild? All of these occasions might shift your estate planning needs, so you should definitely take another look at your documents this year. Make a list of all the changes that you need to your current documents and reach out to the offices of your Illinois estate planning lawyer today.
President Obama signed the American Tax Relief Act (ATRA) of 2012 into law at the beginning of this year, causing many revisions to estate planning code that will affect retiring Boomers in large numbers. According to Forbes, "one of the key provisions of ATRA is to make permanent to so-called portability of the applicable exclusions amount between spouses." The rules of portability greatly affect estate planning, according to Forbes, and should be considered with an estate-planning attorney. So what is portability? What does it do?
According to Forbes, the new laws regarding portability allow for the transfer of one spouse's unused estate tax application exclusion to the other upon the death of the first spouse. This means that the surviving spouse can use this tax application exclusion for gift or estate tax purposes, rather than it going to waste if it hadn't been used before the death of his or her spouse. "Any applicable exclusion amount of the first spouse to die that is used to reduce the estate tax liability of that spouse's estate tax reduced the amount of the excess applicable exclusions amount that carries over to the surviving spouse in the form of ‘deceased spousal unused exclusion amount,' or DSUE amount," reports Forbes.
According to Kitces.com, this new provision will significantly impact the rules regarding estate planning for many years to come, and will affect different people differently based on their income. In some cases, according to Kitces.com, it may render the use of a bypass trust relatively useless, because of the costs associated with trust drafting and administration. By evoking the new portability rules, many people in lower tax brackets will be able to save when it comes to the necessity of having a trust in addition to a will and an estate plan. This is great news for a large majority of Americans.
If you or someone you know is in the beginning stages of estate planning, determining what type of plan is best for you is best undertaken with the assistance of a qualified attorney. Don't go through it alone. Contact an experienced estate-planning lawyer today.
According to a report at Mondaq.com, there have been several changes that have been made this year to Illinois legislation when it comes to matters of estate planning. These changes, if not followed can find Illinois residents paying out more than they need to in taxes. These changes were implemented January 1, 2013.
There a a few key changes that make the amounts at the state and federal level differ. The Illinois estate and generation skipping tax exemption amount is now $4 million while the federal amount is $5.25 million. The federal estate tax exemption has been adjusted to deal with inflation and has increased over $200,000 since 2011. The Illinois tax exemption has not been adjusted to deal with inflation at all.
The estate tax rate has been capped both on the state and federal levels. The maximum with the state is 16% while the federal maximum is 40%. These are only a few of the changes. Some of these changes will affect some people and not others, so consult with your DuPage County estate planning lawyer if you have questions about how it will affect you.
However, no matter your financial status, financial and estate planning is very important. If you do not have your final wishes documented on paper, they cannot be properly executed. You may want particular people to receive your property while others will receive financial gifts from you. Whatever the case is, this information needs to be documented. It is the responsible thing to do.
When you are ready to get your will and other estate planning paperwork done, an understanding and knowledgeable DuPage County estate planning lawyer is your perfect ally. Your attorney will ask for a list of your debts and assets. Your attorney can also assist with the best advise to ensure that your surviving family is taken care of.