“Estate Planning” is the creation of documents to plan for the future. The “Plan” includes documents to empower someone you appoint to make financial or healthcare decisions for you when you are not able. The “Plan” informs your appointee how you desire your belongings to be distributed at your death, via a Will or a Trust. An “Estate Plan” is not a matter of how much you have but how much control you want to keep. Estate Planning, when done correctly, provides peace of mind knowing you have done everything possible to protect yourself and your family. We help you accomplish your personal planning goals and benefit your family by eliminating unnecessary probate costs, guardianship hearings, and taxes.
What do these people have in common?
• Howard Hughes
• Pablo Picasso
• Jimi Hendrix
• Abraham Lincoln
• Sonny Bono
None of these people had an Estate Plan (Will or Trust) at the time of their death, which, in some cases, ignited years of court battles. Of course, no one expects to die until well into old age. We have the expectation we’ve got plenty of time to get everything in order. Or, in Prince’s case, he had it in his mind he wasn’t going to die at all.
When Prince did die on April 21, 2016, the superstar was worth upwards of over $200 million at his home in Minnesota. After many would-be-heirs came out of the woodwork to try to claim some of his fortunes, the Courts determined that only six people (a sister and five half-siblings) had any claim. To learn more, continue reading about what happens if you don’t have an estate plan.
A legally enforceable declaration of how someone wishes their property to be distributed when they die and who they choose to carry out those wishes.
A Pour-Over will is a Will that directs a decedent’s assets into a trust if those assets were not titled in the trust during the decedent’s lifetime.
The person or entity that manages the assets in a trust
When you implement Power of Attorney, you are appointing someone else to act on your behalf for matters that do not concern medical decisions. This person is also known as your Agent or your Attorney-in-Fact. A General Durable Power of Attorney sets out the general (as opposed to medical) powers you are granting to your Agent and authorizes them to act even after you become incapacitated.
To better understand estate planning, continue reading about estate planning terminology.
You’ve worked hard your whole life to provide for your family and make your loved ones more secure. Without advanced estate planning strategies, much of the significant assets you have accumulated may end up with the IRS and state taxing authorities.
Our firm regularly assists successful families with such sophisticated planning strategies as Family Limited Partnerships or Limited Liability Companies, Personal Residence Trusts, Irrevocable Life Insurance Trust, Dynasty Trusts, and a wide range of charitable gifting techniques to reduce Federal Estate Taxes, Gift Taxes, and Generation-Skipping Transfer Taxes. To fully comprehend these matters, continue reading about advanced estate planning topics.
There is a new paradigm in estate planning. Three major changes have profoundly affected the estate planning world.
1. The 2012 American Taxpayer Relief Act (ATRA) increased the estate tax exemption to over $5,000,000 as the lead game changer. Estate Taxes have been eliminated for most Americans.
2. Wisconsin last December passed the new Uniform Trust Code, which took effect on July 1, 2014.
3. The U.S. Supreme Court Decision in Clark v. Rameker that inherited IRA’s are not creditor protected.
An Estate Planning Attorney’s recommendation: All trusts and estate plans prepared before 2012 should be reviewed.
Why were castles built? First and foremost, for protection. Medieval Lords fortified walled structures to protect their people and their land, defend against attack, mark territory, provide security, and ensure privacy. They added features to identify advancing forces from a distance and impede access from outside and unauthorized depletion of the resources within.
Well-crafted Trusts and thorough Estate Plans are forms of castles we build for our clients. Within a Trust is held the assets of the family. When properly designed, the wealth of the Trustmaker is identified and organized. The Trustees are empowered with access, and the rules of distribution are laid out for the current generation and generations to come. To learn how you can fortify your castle, continue reading about building a solid estate planning foundation.
From time to time, prospective clients tell me they don’t completely understand their estate plan. I empathize since Wills, Trusts, and Durable Powers of Attorney can be confusing. What may appear as straightforward terms take on entirely different meanings under the law. Moreover, each state’s laws are different, so when you migrate from another state to become a Wisconsin resident, unintended consequences might arise in your plan.
When a comprehensive estate plan is prepared, it combines several different documents. When the plan is designed by an experienced estate planning attorney, like the attorneys at Ross Estate Planning, LLC, those documents are tailored to the particular client and their wishes and preferences. Signing the plan may involve reviewing over a hundred pages and multiple legal instruments.
To become an educated planner, keep reading about understanding your estate plan.
Consider the following when thinking about your estate. Use these questions to help you evaluate where you are in the estate planning process.
• Have you created a Will or a Trust?
• Does your current Will or Power of Attorney name guardians for any minor children?
• Have you transferred assets into your Revocable Trust?
• Have you appointed someone to handle your financial affairs if you become disabled?
• Do you have a current Health Care Power of Attorney appointing designated agents who will handle your medical care if you become disabled?
These are imperative questions that need answering for an effective estate plan. For additionally important questions, continue reviewing our estate planning checklist.
Planning Tip: Like your car, your estate plan needs regular “servicing.” Set aside a specific time every year (your birthday, anniversary, family gathering) to review it. Become familiar with it. Keep it current so it will perform the way you want when you need it.
The following situations should trigger the need to seek immediate legal help to review or revise the family’s current estate and tax plan:
• Severe or life-threatening illness
• Illness or death of a spouse
• Contemplation of marriage, or remarriage
These are just a few reasons to amend an estate plan. For more scenarios, continue reading about situations requiring a revision of an estate plan.
Like your car, your estate plan needs regular maintenance. Your plan needs to be reviewed and updated to deal with the changes in your family and the constantly changing laws. If you do not spend the time and money now, your family will spend exponentially more when you are gone. Set aside a specific time each year (birthday, anniversary, family gathering) to review it. Keep it current, so it will work the way you want when you need it. To learn how to appraise your out-of-date estate plan, read the top seven methods of updating your estate plan.
We are living in very challenging times. Covid-19 has attacked the whole world with a vengeance, putting life in jeopardy. Are you ready if a family emergency arises? If you do not set aside the time and money now, your family will spend much more when you pass or become debilitating. Set aside time right now. Allow me to suggest three critical steps you need to take right now, presented in four installments; read the three critical things you need to do now!
Within the last fifteen years, the number of adults assisting their aging parents has tripled. Twenty-five percent of grown children help their parents personally or financially. As anyone who has performed it knows, caregiving can be a full-time job with significant overtime. It is important to prioritize fun, quality time while arranging legal matters with your parents. Your family might be eligible for federal, state, and local resources. It is paramount to pursue them all. Don’t feel like you have to do it yourself; gather the extended family and notify your employer and colleagues of what you are working through with your parents. For suggestions explained in greater detail, continue reading about caring for an aging parent.
On December 20, 2019, President Trump signed the Setting Every Community Up for Retirement Enhancement Act (SECURE Act). It is brand-new. It passed immediately without any discussion and was effective on January 1, 2020. The Act is the most impactful legislation affecting retirement accounts in decades. There is good news and bad news.
Overall, the SECURE Act was touted as a law that made it easier for small businesses to provide employees with retirement benefits. When you look up an explanation of the Bill online, that’s what you learn in the headlines: Easier and less expensive for ‘safe-harbor’ retirement plans for both part-time and full-time employees of small businesses.
That sounds GREAT, right? And if you’re already retired, it also sounds like it doesn’t apply to you. The SECURE Act has many complex positive and negative changes. To understand in detail, continue reading about how the SECURE Act has impacted estate planning.
If you become incapacitated, you won’t be able to manage your financial affairs. Many are under the mistaken impression that their spouse or adult children can automatically take over for them if they become incapacitated. The truth is, for others to be able to direct your assets, they must request a court to announce you lawfully inept. This process can be lengthy, costly, and stressful. If you want your family to be able to take over for you immediately, you must designate a person or persons that you trust in proper legal documents so that they will have the authority to withdraw money from your accounts, pay bills, take distributions from your IRAs, sell stocks, and refinance your home.
Furthermore, planning for the financial aspect of your affairs during incapacity, you should establish a plan for your medical care. The law allows you to appoint someone you trust to make decisions on your behalf about medical treatment options if you lose the ability to decide for yourself. You can do this by using a durable power of attorney for health care to designate the person to make such decisions. In addition to a power of attorney for healthcare, you should also have a living will which informs others of your preferred medical treatments should you become permanently unconscious or terminally ill.
If you leave your estate to your loved ones using a will, all of your assets will pass through probate. The process is expensive, time-consuming, and open to the public. The probate court is in control of the process until the estate has been settled and distributed. It is not unusual for the probate courts to freeze assets for weeks or even months while trying to determine the proper disposition of the estate. With proper planning, your assets can pass on to your loved ones without undergoing probate efficiently and privately. For more information, continue learning about probate.
It is important that your estate plan address issues regarding the upbringing of your children. A good plan should provide for people you’d like to manage your assets as well as the guardian you’d like to nominate for the upbringing of your children. Otherwise, deciding who will manage your finances and raise your children will be left to a court of law. You should give careful thought to your choice of guardian, ensuring that they share the values you want to be instilled in your children. You will also want to consider the age and financial condition of a potential guardian.
Whether there will be any federal estate tax to pay depends on the size of your estate and how your estate plan works. Many well-established strategies can be implemented to reduce or eliminate death taxes, but you must start early planning to implement many of these plans.
Do you want to benefit a charitable organization or cause? Your estate plan can provide in a variety of ways, either during your lifetime or at your death. Depending on how your planned giving plan is set up, it may also let you receive a stream of income for life, earn higher investment yield, or reduce your capital gains or estate taxes.
A well-crafted estate plan should provide for your loved ones effectively and efficiently by avoiding guardianship during your lifetime, probate at death, estate and income taxes, and unnecessary delays. The primary goal of wealth transfer should be to preserve your values and the corresponding protection of your children. With issues today of divorce, drug and alcohol dependence, lawsuits, and fiscal irresponsibility, you can design a plan that can give your children the support and maintenance they need while safeguarding them.
Outright distributions can, and often do, have a devastating effect on the recipient. Comprehensive estate planning will ask the right questions and provide the solutions you may want and need. You should consult a qualified estate planning attorney to review your family and financial situation and your goals and explain your various options. Once your estate plan is in place, you will have peace of mind knowing that you have provided for yourself and your family.
What To Do Before an Emergency Occurs
In 2008, Mary got news no spouse wants to hear. Her husband of 20 years, Bob, had experienced his first heart attack at the age of 40. Bob had a strong will to live and was determined to change his lifestyle and get in shape. He succeeded in both! However, four years later, while exercising, he suffered a fatal heart attack. Mary knew how to raise kids but did not know a stock from a Money Market account.
Family emergencies are blind-siding. While we all hope for the best, it is critical to ensure you are ready for the worst. For an acuter appreciation, continue reading how an estate plan can prepare you for a family emergency.
Nontraditional families take many forms – a grandmother raising a grandchild via an informal custodial arrangement, an unmarried couple with children and perhaps stepchildren, a couple in a same-sex marriage. In June 2015, the U.S. Supreme Court ruled that the Constitution guarantees the right to same-sex marriage, which affords them most of the federal privileges available to traditional couples. Other nontraditional families, however, are not recognized as families by the state or federal government. Accordingly, they are not granted the same benefits concerning estate planning, guardianship of minor children, and health care proxy designations. To comprehend the intricacies, keep reading about what estate planning looks like for nontraditional families.
ESTATE PLANNING: CARING FOR YOUR PETS
Have you seriously considered what will become of your faithful companion – your beloved pet – upon your death or disability? If not, now is the time. If you don’t have a plan in place that quickly and easily provides for your pet’s food, shelter, and care, you must take steps to include your cherished pet in your estate plan. The specific estate planning method that ensures a quality life for your pet will depend on several factors, including state laws, your pet’s needs, wishes, and financial resources. We have provided the resources for you to include your pet in your estate plan.
Door County, Kewaunee County, Green Bay, and Northeast Wisconsin are served by Ross Estate Planning, LLC. We specialize in asset protection, estate planning, and business planning for individuals and families, organizations, and business owners with over 40 years of expertise. Educating the client and obtaining accurate information is important since we feel educating the client and obtaining the correct information is a priority when providing quality estate planning services. We offer clients and interested clients a complimentary estate planning book and a complimentary consultation with an experienced attorney.