Travels through Property Law by Tom Brodersen, Esq.
Estate Planning
People use estate planning to accomplish a number of practical (and very important) results in their affairs.
Some examples include the disposition of their property at the time of (or before) their demise, or to make changes to previous such moves. Avoidance of probate, along with the expenses and delay that process introduces is also a popular purpose, along with tax avoidance.
There is currently an estate tax exemption of over $11 million dollars, which is going up to cover inflation. Even if Congress makes no further changes, the worst thing that will likely happen in the future is that the exemption may drop down to $5 million in 2025. In the unlikely event that will happen, most estates are less than $5 million, so few families are affected by estate taxes anymore. There are other (usually much smaller) tax considerations to take into account in structuring your affairs, however.
Other areas of concern include providing for heirs that may have special problems or challenges, such as medical conditions, the inability to provide for themselves due to age, addiction or vulnerabilities to gambling, etc. These issues are usually best served by placing property in a trust, with provisions as elaborate as you may need, along with careful selection of an appropriate trustee.
Assuring eligibility for government subsidies of nursing home care or other expensive benefits is also a frequent concern, along with worries such as asset protection and business succession planning.
Protecting your loved ones from manipulation should you lose your ability to manage your affairs as a result of mental decline is important and involves an area of estate planning called elder affairs. If not handled appropriately, it sometimes causes outcomes far from what you would approve if you were there and fully able to control it.
Also, in the general area of elder affairs is assuring appropriate decision making as you age and medical challenges and decision making becomes more and more complicated. Advanced directives are widely advised but actually little understood and need careful thought.
There are a great many issues addressed by estate planning, and many and varied solutions, so careful attention to the details, along with your hopes, fears and ambitions for your family are inextricably involved.Talk to an experienced estate planner before you sign any documents. And listen carefully to the advice.