Terry White, Attorney with White Peterson & Guest Contributor
Tax time is an excellent occasion to review one’s estate planning, business planning, and business succession planning. Have things changed to the point that warrants a professional review of these matters with your CPA, Lawyer, and other financial and professional advisors?
The following is a short non-exclusive checklist of items to consider
- Is my will and/or trust up to date and reflective of my desires? Whatever those documents provide is what will happen after your death. Make sure they are correct and reflect your desires
- Are my insurance beneficiaries still correct? Life insurance proceeds do not pass according to a will or trust but rather are considered a “non-probate” transfer and will transfer according to whoever is named beneficiary. The same applies to IRA and other retirement account beneficiary designations
- Have there been any life changing situations? Death, divorce, health concerns, wealth concerns, remarriage and so on. If so, do my estate planning documents properly reflect the changed circumstances?
- I do not have a will, so what happens? A person with no will has left the determination of who gets their estate in the hands of state law of the state where they resided or the law of the state where real property is located in certain circumstances. This can cause serious problems, particularly later in life if second marriages with competing sets of children. Example: Spouse dies with no will. Property passes to surviving spouse with certain exceptions. Second spouse dies. Property passes to children of second spouse to die completely omitting children of first spouse to die. Result: Problems, unhappiness, family discord, unfair results and the list goes on. For young families without a will the issue of guardianship of minor children is left open for discussion, dissention and additional heartache.
- Do I need a living will? A living will is a direction to a trusted person to take action in the situation where I am unable to communicate, the administration of drugs and machines will only artificially extend the moment of my death, and two Doctors have certified this to be the case. The living will states what your intentions are: Keep all machines and drugs to extend the moment of death; remove all machines and drugs except food or water; remove the machines and drugs except those to maintain a pain free remaining time. These are serious matters to consider and choices to be made.
- I placed one of my children on my bank accounts because they live close by and I want someone to be able to pay my bills if I have a stroke. Is this a problem? On your death, is it your intention that all of what is left in the account goes to that child, or is it to be divided among all of your children? Whatever the answer to that question it needs to be clearly set forth in your estate planning documents. During your lifetime there are better alternatives than making one of your children a joint owner of your funds.
It is wise to set aside some time each year to make sure your estate planning is up to date and in accordance with tax law and other legislative changes. If you see a need, consult with your estate planning professionals. Don’t leave your estate planning to chance. You have been careful with other aspects of your finances; make sure you are careful in this area too.
