The practice of estate planning is as old as civilization itself and the issue of what one leaves behind and to whom remains as relevant and complicated as ever. Laws in this area have evolved somewhat with the changing times but the basic issues remain the same – how to organize one’s affairs so that loved ones can benefit from remaining assets with as little difficulty as possible.
Estate planning is very important for people in California, no matter their age. Those who are later in life might want to consider forming an estate plan as soon as possible. People who are younger, should also form estate plans. However, one mistake people sometimes make is that they form an estate plan early in life and then simply forget about it.
Married couples who have begun the estate planning process probably already know that it is common to create complimentary wills with one’s spouse. Some people choose to create joint wills or wills that take the other’s plans into account, while others choose to keep their last will and testament confidential and separate from their spouse. There is no one right way to complete this process, it is up to the individuals to determine what makes the most sense for them.
Tax planning and estate planning often go hand-in-hand, since it is a priority for many California families to preserve assets to pass along to the next generation. There a lot of different ways to go about doing this that are all perfectly within the bounds of the law, although some tax minimization tactics are more controversial than others. In choosing any type of estate tax plan, it is crucial to receive qualified and reliable advice and to structure the passage of assets in strict accordance with the law.
A personal trust set up by rookie NBA player Michael Carter-Williams is making the news as a surprisingly wise decision from a first-time professional athlete. Players from the NBA declare bankruptcy at a startling rate of 60 percent within their first five years of retirement, indicating that financial management may not be a top priority for players in the league.
It can be tempting once an estate plan is finished to simply put the paperwork in a filing cabinet and never give it a second thought, but most estate planning experts would advise against that. Estate plans should be periodically revisited to make sure they are up-to-date with current laws and with your current wishes for how your assets are distributed. At the same time, there are some types of life events that should be accompanied by an estate plan review
Making an estate plan is a complex process that can sometimes take quite a while, from the time that you lay out all your assets to the final process of executing a will properly in front of witnesses, months can pass. For people who are experiencing a serious illness or even those in relatively good health, this span of time could make a big difference. In one recent case a man suddenly passed away while in the process of updating his estate plan, leaving his sons to pursue legal action to see that his final wishes were respected.
The government requires money in order to operate and continue providing necessary services for a safe and productive society. However, in order to obtain these required operating funds, the government must levy taxes on the population which it governs in California and in every other state. Most people are aware of the income tax system and how it works. On the other hand, many are not so familiar with how the estate tax and gift tax system operates.
Our readers in the Bay Area are aware that there are many ways in which people can minimize current tax liabilities. There are also ways in which you can limit future tax liabilities. Occasionally there are ways in which you can do both.
The Small Business Administration was asked to testify before a Congressional sub-committee this week. The Small Business Committee of the House of Representatives is looking into the potential impact upon small business of changes to the estate tax, which is set to expire in Jan. 2013.