Each year people tend to make resolutions, and in many cases, you will resolve to take care of things that you have been procrastinating about. This should enter the picture if you have not reviewed your estate plan in some time.
Estate planning is not something that is permanently accomplished in one sitting, unless you concoct your estate plan while you are lying on your death bed.
If you are responsible about making sure that you have all of your bases covered, you will take action as soon as you are a self-supporting adult. This initial estate plan is probably not going to accurately reflect your life situation as the years pass.
You may experience changes in marital status, and you may have children. In addition to the family dynamic, your financial situation could improve considerably over the years, and this can be relevant as well.
Plus, as your loved ones evolve into adults, you may recognize their proclivities, and you may want to adjust your estate plan to include safeguards of one kind or another.
Changes in your own life can necessitate estate plan updates, but there are also things that are out of your direct personal control that can render your existing estate plan obsolete. Tax laws can be revised, and in fact, the estate tax parameters have been changed multiple times over recent decades.
As a case in point, the estate tax exclusion is $5.43 million at the present time. This is the amount that you can transfer to people other than your spouse tax-free before the estate tax would kick in.
The White House has proposed a reduction in the exclusion to $3.5 million in the last two budgets that have been submitted. These proposals have not been adopted, but this exemplifies how you could be exempt from the estate tax on one day and exposed the next.
You could revise your estate plan to implement estate tax efficiency strategies if you find that you are suddenly exposed.
If you devised your estate plan many years ago and you simply stuffed the papers in a drawer somewhere, you may not even remember exactly how you went about it.
Estate planning is an ongoing process, and you should make sure that your plan is always up-to-date. Now that we are in a new year, you may want to take action if you haven’t looked at your estate plan in a while.
Schedule a Review
We can help if you would like to conduct a comprehensive estate plan review. Our firm offers free consultations, and we would be glad to become apprised of your current situation, compare it to your existing plan, and recommend the appropriate adjustments.
To set up an appointment, send us a brief message through this page: Indianapolis IN Estate Planning Law Firm.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.
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