Downs Law Firm, P.C.
Downs Law Firm, P.C.
Estate planning is a systematic process, which involves getting your personal and financial goals for the time you pass away or become mentally incapacitated. It is also known as a last will, and almost everyone does this planning for their family.
While everyone from brand new parents to great grandparents can benefit from the advice of a competent estate planning lawyer, frequently the individuals making sure that their affairs are in order, are those in their golden years. They have a common concern: what about their grandbabies?
Want to make a big impact? Consider passing on some of your assets through charitable giving. While many people transfer their assets to the next generation, there are many who want to give some, or even all, of their assets away through charitable giving. That can make a big impact, according to MarketWatch in “Giving your money away when you die: 10 questions to ask.” If you haven’t thought about charitable giving or estate planning, these 10 questions should prompt some thought and discussion with family members: Should you give money away now? Don’t give away money or assets you’ll need to pay your living expenses, unless you have what you need for retirement and any bumps that may come up along the way. There are no limits to the gifts you can make to a charity. Do you have the right beneficiaries listed on retirement accounts and life insurance policies? If you want these assets to go to the right person or place, make sure the beneficiary names are correct. Note that there are rules, usually from the financial institution, about who can be a beneficiary—some require it be a person and do not permit the beneficiary to be an organization. Who do you want making end-of-life decisions, and how much intervention do you want to prolong your life? A health care power of attorney and living will are used to express these wishes. Without these documents, your family may not know what you want. Healthcare providers won’t know and will have to make decisions based on law, and not your wishes. Do you have a will? Many Americans do not, and it creates stress, adds costs and creates real problems for their family members. Make an appointment with an estate planning attorney to put your wishes into a will. Are you worried about federal estate taxes? Unless you are in the 1%, your chances of having to pay federal taxes are slim to none. However, if your will was created to address federal estate taxes from back in the days when it was a problem, you may have a strategy that no longer works. This is another reason to meet with your estate planning attorney. Does your state have estate or inheritance taxes? This is more likely to be where your heirs need to come up with the money to pay taxes on your estate. Maryland has a 10% tax for gifts to people who are not close relatives. This would include nieces and nephews. There is no such tax on life insurance proceeds. Your decisions of “Who gets what” can include significant tax consequences. A local estate planning attorney will be able to help you make a plan so that your heirs will have the resources to pay these costs. Should you keep your Roth IRA for an heir? Leaving a Roth IRA for an heir, could be a generous bequest. You may also want to encourage your heirs to start and fund Roth IRAs of their