By Howard M. Rosen, Epstein Schneider, PLC
By now you have heard that Congress is taking a look at revising or even eliminating the estate tax. So, how do you plan for your estate in such an uncertain environment?
First, let’s take a look at what estate planning entails. We start with the basics: wills and trusts.
Wills are public documents that dictate how your assets are to be distributed at your passing. The problem with wills is they are public, which means anyone can access them to see what assets you owned. In addition, wills are subject to probate, an expensive way to administer your estate.
Trusts accomplish the disposition of your assets but are private (not open to public disclosure) and less costly to administer than wills. This will hold true no matter what Congress does to change the federal estate tax laws.
Trusts, like wills, can be modified, changed or revoked in whole or in part at any time prior to your passing. Not happy with how your assets are to be distributed? Change your trust. Have a new family member? Change your trust. You have the ultimate in flexibility during your lifetime.
These are easy first steps that everyone should utilize. Next we move on to healthcare directives and powers of attorney, but we’ll leave that for next time.
Of course, for larger estates there are methods to reduce or eliminate any potential tax on the disposition of your assets. We suggest you talk with your tax advisor about your estate planning needs.
