Estate Planning Points To Focus On – When making long-term estate plans, you’ll find it helpful to take it one step at a time. A good way to start is by asking yourself some questions:
- Is my current estate plan structured efficiently to minimize family effort and expense, or even controversy, after my death?
- How might new federal economic and tax policy changes impact or undermine my existing estate planning?
- Do I have powers of attorney and a living will that express my wishes and allow my family or designees to make financial, business and health care decisions if I’m incapacitated?
- Have my adult children executed the necessary basic legal documentation to allow me to assist with their affairs in the case of accident or illness?
- Are my assets structured in a way that limits my exposure to potential liability?
- Will my qualified retirement accounts pass to my beneficiaries in a protected and tax-efficient manner, in light of changes to applicable law?
- Have I implemented planning that will allow my business to continue operating after my incapacity or death?
- Have I set up a special needs trust to provide for my disabled child?
- What are the potential risks and benefits related to digital assets in my estate plan?
- Have I discussed my long-term plans with my heirs so there are no unpleasant surprises (especially if we are a blended family)?
Watch for long-term changes
Estate planning is especially key in uncertain times, so consider potential ramifications:
- Changes to federal gift and estate tax exemptions are scheduled to occur Jan. 1, 2026, and could happen earlier.
- Income tax deferral opportunities with inherited retirement accounts are currently limited.
- You can’t properly plan your estate without taking possible future regulatory and legislative changes into account.
- State laws vary widely, so you have to take those into account, especially if you move when you retire.
Other issues central to planning efforts
A special needs trust can provide for children with physical or mental disabilities who are younger than 65 when you’re no longer around to take care of them. The trust, rather than your child, owns the assets, so they are excluded from asset limit tests for Social Security’s Supplemental Security Income and Medicaid. A trust can help fund quality-of-life improvements, such as a private room in a group care facility, beyond what Medicaid pays.
Careful planning can help ensure that the time leading up to your death is less difficult and stressful for your family and that your estate is settled in an efficient and cost-effective manner. You want your beneficiaries and assets better protected against subsequent lawsuits or divorce.
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