Last Word (eBook)

7 Estate Planning Considerations

Timothy W. Crowley Esq. (Autor)

eBook Download: EPUB

2025 | 1. Auflage
272 Seiten
Bookbaby (Verlag)
979-8-3509-9027-0 (ISBN)

Infos

A book in plain english about estate planning, filled with funny real-life stories and amusing observations.

Tim Crowley has been an attorney for nearly thirty years, practicing in the areas of estate planning, probate, and trust administration. He now works primarily as a trustee of numerous large family and charitable trusts. Prior to becoming an attorney, Tim served as a congregational minister. His background as a minister offers a unique perspective on estate planning, especially navigating family dynamics and potential conflicts. For many years, he worked at large law firms, but eventually opened his own law office to offer estate planning and trustee services. Frequently his clients asked him to recommend a book on estate planning. He found most books on the topic quite complicated and technical. So, he wrote 'The Last Word' to explain estate planning in plain English. His educational background includes a B.A from Houghton College, M.Div. from Princeton Theological Seminary, and Juris Doctorate from Syracuse University College of Law.

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This book addresses seven estate planning considerations: 1. Preparing for Death by making a Will or revocable trust agreement, as well as possibly a disposition of remains form; 2. Creating Trusts for yourself, spouse, children, other family members and friends, or charity; 3. Contemplating Future Incapacity with a power of attorney, living will, appointment of health care agent, or a trust to hold property and financial accounts; 4. Implementing Asset Protection in the event of nursing home or late-in-life health care expenses, marital problems, threatening creditors, or for a disabled family member; 5. Saving Taxes at death and during life using trusts and other estate planning techniques; 6. Engaging in Philanthropy to maximize charitable giving impact and save taxes; and 7. Selecting Fiduciaries (executors, trustees, guardians) who will carry out your wishes.

Textauszug

INTRODUCTION
Seven Estate Planning
Considerations

Some say that the person who dies with the most toys wins. The reality is that those who die with the most toys, or the most money, just die, like everybody else. Whether we die with few toys or many toys, or even millions or billions of dollars, really does not matter. We are gone. The old saying “You can’t take it with you” is true. Ancient wealthy Egyptians tried to take it with them to the other side. They filled their tombs with their most valuable possessions. It was not surprising when, centuries later, archeologists discovering those undisturbed tombs found everything still there. While we cannot take it with us, we can have the last word about where it all will go. How often do we hear “Get your affairs in order”? It is good advice. When we do not get our affairs in order before we die, we can leave a mess for our loved ones. Sometimes that mess creates dissension and ultimately damages, if not destroys, our family. When we implement proper estate planning, and thereby have the last word, we can spare our loved ones turmoil and conflict.

Planning for our eventual death—deciding who gets what, and making burial or cremation decisions—is the primary consideration of estate planning. However, in addition to preparing for our death, there are six other important estate planning considerations. These other considerations include creating trusts, planning for the possibility of incapacity, providing asset protection, minimizing taxes, engaging in charitable giving, and choosing fiduciaries (such as executors, trustees, and guardians).

This book divides estate planning into these seven “considerations”:

Consideration One:

Preparing for Death

Consideration Two:

Creating Trusts

Consideration Three:

Contemplating Future Incapacity

Consideration Four:

Implementing Asset Protection

Consideration Five:

Saving Taxes

Consideration Six:

Engaging in Philanthropy

Consideration Seven:

Selecting Fiduciaries

Consideration One: Preparing for Death. The first consideration of estate planning focuses on death. We must address who gets what after we die, and how and when they get it. Generally, this is what we think of when we hear the term “estate planning.” However, deciding whether we wish to be buried or cremated, and how we want this decision to be carried out, is another important part of preparing for our death. Many of us believe that the disposition of our assets at death is accomplished only through a Will, but there are many ways that property is given at death besides through a Will. For instance, jointly owned property is usually not controlled by a Will. Instead, such property passes automatically to the surviving joint owner at our death. Assigning a beneficiary designation to our property is another common way that our assets can be automatically distributed at death. Retirement plans, life insurance, and many financial accounts pass this way at our death. A trust agreement is also an option for the disposition of our assets at death. Property held in trust passes at our death in accordance with a written trust agreement, not by a Will. If all of our assets are jointly owned, are designated to pass to a beneficiary, or are held in trust, then we may have nothing left that requires a Will.

Consideration Two: Creating Trusts. The second estate planning consideration focuses on whether it makes sense to create trusts as part of our estate plan. Trusts can be an essential aspect of proper estate planning. The reasons for creating them vary. We may create a trust for our own benefit or the benefit of loved ones, such as our spouse or our children. A trust for our own benefit might deal with possible incapacity later in life, or to save taxes, or to give to charity. Or, we may want to avoid probate, so we create a trust that acts as a Will substitute to avoid court intervention in the administration of our estate when we die. A trust created to benefit a loved one may serve one of several purposes, such as to save on taxes, provide asset protection, or manage an inheritance. We may also want to ensure that after our loved one dies, our assets are further distributed in accordance with our wishes.

Consideration Three: Contemplating Future Incapacity. The third estate planning consideration has to do with planning for the possibility, maybe even the likelihood, that at some point during our lifetime, we will not be able to manage our affairs. Accident, stroke, dementia, illness, and frailty are typical precedents to incapacity. If we live long enough, it is possible we will get to the point when we cannot handle our checkbook or manage our properties and investments. I have seen extremely capable people decline with the onset of debilitating disease. Age itself brings on limitations. For some, it is a gradual decline. For others, it is a sudden event such as a stroke or fall. Whatever the case, we need to have estate planning documents in place to deal with the possibility that one day we may be unable to manage our property and financial affairs, make personal decisions, or determine proper health-care treatment.

Consideration Four: Implementing Asset Protection. The fourth estate planning consideration has to do with asset protection. Protecting one’s personal assets is typically a primary concern for professionals in high-risk fields, as well as for business owners who provide services and goods that could incur greater liability than most. Asset protection is not, however, just a concern of high-risk professionals and business owners. As we age, many of us may start to consider how we will pay for long-term health-care costs. Approximately half of us will end up in a long-term skilled nursing facility for some period of time. As this possibility draws nearer and we contemplate the cost of long-term care, we may begin to consider ways to preserve and protect our assets for our spouse or heirs. Finally, the potential for a loved one to undergo a divorce or face financial problems may be reasons for us to be concerned about asset protection in our estate planning.

Consideration Five: Saving Taxes. The fifth consideration of estate planning, which pertains to some people more than others, has to do with minimizing or eliminating taxes during life and at death. Through various estate planning strategies, we can take steps to reduce or avoid taxes. There are several different types of taxes that the federal government and state governments impose. Estate planning typically addresses transfer taxes first. Transfer taxes include estate taxes, gift taxes, and generation-skipping transfer (GST) taxes. In addition to minimizing or eliminating transfer taxes, estate planning can also deal with ways to reduce or minimize income taxes and capital gains taxes during our life and at our death.

Consideration Six: Engaging in Philanthropy. A sixth estate planning consideration is charitable giving, also known as philanthropy. During our lives and in arrangements we make for the distribution of our estate at our deaths, we may be inclined to make gifts to charitable organizations that reflect our personal values and beliefs. Philanthropy can take many forms. We can make outright gifts to charitable organizations during life or at our death. We can also create certain types of trusts during life that make ultimate distributions to charity upon our death (or at the end of a term of years), while providing us with a stream of income and an immediate personal tax benefit while we are alive. If we plan to leave a considerable amount for charitable purposes, we may choose to set up our own private charitable foundation. A private charitable foundation allows our name, values, goals, and philanthropic legacy to live on in perpetuity. If a private charitable foundation is not desired or appropriate, we may instead leave funds to a community foundation, faith-based foundation, or donor-advised fund.

Consideration Seven: Selecting Fiduciaries. The seventh and final estate planning consideration concerns choosing fiduciaries. Fiduciaries include the executor of our Will, trustee of any trusts we create, guardian for minor children, agent under a power of attorney, and agent under a health-care document. A fiduciary may be a family member, friend, colleague, professional (such as an attorney or accountant), or a financial institution. These decisions about who will serve in these roles are often complicated and sensitive, and there are pros and cons associated with each option. Choosing the wrong fiduciary may have serious...

Produkt-Details

• Erscheint lt. Verlag: 21.1.2025
• Sprache: englisch
• Themenwelt: Recht / Steuern ► Privatrecht / Bürgerliches Recht ► Erbrecht
• ISBN-13: 979-8-3509-9027-0 / 9798350990270