Reviewing Your Estate Plan
Whether you established your estate plan last month, a year ago or 15 years ago, you should review and update it regularly. Why? Every few years new tax laws, IRS rulings or case law can change the rules of the game and make your plan less tax efficient, or even obsolete. Meanwhile, you and your family will be aging and changing, and your goals may also have changed.
To ensure that your plan meets your estate planning goals, organize relevant personal and financial information. Giving the right information to the right persons now can make administration of your estate easier and less costly when the time comes for others to take over for you.
Is Your Current Plan Complete?
If you have an existing plan, make sure that it was drafted by a competent professional and that you have taken all of the steps necessary to implement your plan. Start by asking yourself the following questions:
- Does my plan make use of the federal exemption amount?
- Does my plan take advantage of the unlimited marital deduction ?
- Do I have a living or testamentary trust with provisions for a credit shelter trust?
- Do I have a Health Care Power of Attorney and/or Living Will?
- Does my plan include provisions for incapacity, disability or other lifetime events that may cause me to lose the ability to control my assets personally?
- Does your plan minimize any potential exposure to estate tax at both the federal and local levels?
Is Your Plan Up To Date?
Even if your current plan was drafted appropriately at the time, every estate plan needs to be monitored and reviewed on a regular basis. Below is a list of some important life events that you should focus on in reviewing your estate plan:
- A change in marital status
- The birth of a child
- A change in your state of residence/li>
- A significant change in the value or character of your assets
- A change in intended beneficiaries
- The death of a beneficiary
- The death of a guardian, trustee, or personal representative named in your will
- A change in tax laws affecting federal estate tax deductions and calculations
Frequently Asked Questions About Estate Plans
Why should I have an estate plan?
It’s important to have an estate plan and to update it regularly, since new tax laws or IRS rulings can make your plan less tax efficient or even obsolete. To avoid issues later on, organize relevant personal and financial information and provide it to an attorney who can make the administration of your estate easier and less costly.
How do I plan for my estate?
If you have an estate — which consists of all the property you own or control — seek competent legal counsel from an estate planning lawyer to protect these assets and ensure your wishes are fulfilled upon your death. You may benefit from creating a will or trust, or both. Speak with an attorney to learn what the best options are for the goals you wish to achieve through your estate plan.
How do I get an estate plan?
Once you have an estate plan, make sure it’s monitored and reviewed on a regular basis by a competent professional. Important life events that you should focus on when reviewing your estate plan include a change in marital status, the birth of a child, and a significant change in the value of your assets.