Downs Law Firm, P.C.
One Social Security change next year that has been a while in the making is that the full retirement age (FRA) will officially be set at 67.
Estate planning is all about taking charge of your legacy.
Probate can tie up assets, create delays and drain estate value—many families benefit from planning around it.
Done just in time for July 4th, the recently enacted “One Big Beautiful Bill” brings significant changes to federal estate, gift, and generation-skipping transfer tax laws. Effective January 1, 2026, the federal exemption amounts for these taxes will increase to $15 million per individual and $30 million for married couples, with annual adjustments for inflation thereafter. This “permanent” increase replaces the previous provisions under the Tax Cuts and Jobs Act (TCJA) of 2017, which had temporarily doubled the exemption amounts but were set to expire at the end of 2025. Without the change, the exemptions would have reverted to approximately $7 million per individual or $14 million for married couples. Of course, a change to federal law is only “permanent” for as long as it has not been changed another law, but it is significant that this increase comes without a sunset provision. Families should now be able to plan with greater confidence into the future for these exemption numbers. Implications for Estate Planning The higher exemption amounts provide an opportunity for individuals and families to transfer more wealth without incurring federal estate, gift, or GST taxes. However, it’s important to note that the top tax rate for amounts exceeding the exemption remains at 40%. While the federal exemptions have increased, Maryland’s estate and inheritance tax laws remain unchanged. Maryland imposes an estate tax on estates exceeding $5 million and an inheritance tax on certain beneficiaries, regardless of the estate’s size. Maryland’s governor proposed several changes to these taxes this year, including elimination of the inheritance tax and reducing the estate tax exemption to $2 million for individuals and $4 million for married couples, but those changes were not adopted by the Maryland legislature. Maryland remains the only state with both inheritance and estate taxes. Action Steps Given these changes, we recommend the following: Review Your Estate Plan: Ensure your current estate plan aligns with the new federal exemption amounts and considers Maryland’s unique tax laws. Utilize Gifting Strategies: Consider making lifetime gifts to take advantage of the increased exemptions. Consult with Professionals: Work with estate planning attorneys and financial advisors to develop strategies that minimize tax liabilities and achieve your wealth transfer goals. At Downs Law Firm, we are committed to helping you navigate these changes and optimize your estate planning. Contact us to schedule a consultation and discuss how the new law impacts your estate plan. This article is for informational purposes only and does not constitute legal advice. Please consult with a qualified attorney for personalized guidance.
With the Great Wealth Transfer underway, the latest figures from Cerulli (as of December 2024) show that $124 trillion will transfer through 2048, with $105 trillion going to heirs.
You’ve done all you could to draw up the perfect trust to protect your child and help them on the path to recovery. Now you need the right person (or team) to help make it happen.
Home equity has ballooned in recent years. However, people who use a new way to pass it on can run into trouble.
To protect your family, you should have a set of estate planning documents that address who is in charge if you are disabled or when you die. There are some important documents that should always be in your estate plan to protect your family. However, some people still leave them out, according to Consumer Reports in “8 Essential Steps for Estate Planning.” A survey from Caring.com showed that as many as 60% of adults don’t have estate planning documents. When they asked families with young children, fewer than one in ten have even designated a guardian to take care of their children, if both parents should die. Worse yet, we have worked with numerous cases where people thought they had documents in place, but due to their own misunderstanding of the law or requirements, their plans were agonizing disappointments of what should, and could have been… What happens when there’s no planning in place? Even the simplest things become more complicated, and complicated things become financial and legal nightmares. When there’s an emergency and decisions need to be made, the entire family is subjected to more stress and costs than would otherwise be necessary. Here are the eight steps you need to take, right now, to protect your family: Get the professional help you need. The change to the tax law may or may not impact your family and your estate plan, but you won’t know until you sit down with an estate planning attorney. Trying to do this online may seem like a simpler way, but you will not have the same peace of mind as when you sit down with an experienced attorney, one who knows your state’s laws. Create a will. This is a legal document that outlines how you wish to distribute your assets upon your passing. It names an executor to carry out your instructions. If you have minor children, this is an especially important document, since it is used to name their guardian. If you have no will when you die (called dying “intestate”), then the laws of your state determine how your assets are distributed and who rears your children. Depending on where you live, your spouse might not automatically inherit everything. Discuss whether you need a Revocable Living Trust. In most states, when you pass away, your estate goes through a process called “probate.” The courts basically review your estate plan and determine whether everything looks right. The problem is that your will becomes a public document—and so does information about your assets. Some people prefer to keep their lives private by transferring assets to a revocable living trust, which distributes assets according to your instructions at your death. Titles to the assets must be changed so they are “owned” by the trust. This is known as “funding” the trust. You still retain complete control of your assets, since you are the trustee. However, if you fail to retitle assets, the estate goes through probate. You will also still need a will
Regular summer days blur together. They’re just one long hot stretch of cereal, TV reruns, and whatever’s in the fridge. But vacations? That’s where the memories live.
A power of attorney gives someone the authority to act on your behalf. However, understanding the scope and limits of that power is essential to protect your interests.
