Happy New Year! Now that the holidays are over, we all get back to our so-called “normal” lives and start on those New Year’s resolutions. One resolution that many of us make is to get our estate planning done. Speaking from years of experience working with clients on their estate plans and post-death administration, let me tell you that this is one resolution that you do not want to forget about.
We all know that bad things happen, and usually when you’re least expecting it. We are all busy living our lives, day by day, trying to get through our endless “To-Do” lists. But a life-changing, or life-ending, accident or illness can strike at any time and at any age. None of us are immune from this. So plan for it now.
A basic estate plan for everyone over the age of 18 should consists of:
- Advance Directives for Health Care (i.e., Health Care Power of Attorney, Living Will, HIPAA Authorization)
- Property (or Financial) Durable Power of Attorney
- Simple Will
If you do nothing else, get these documents in place! They can make a world of difference for you and your family if you ever become incapacitated or die. And remember that, even though you may be only 18 years old, or you eat healthy and exercise every day, you are not invincible. Do you really want your family to suffer any more than necessary if something happens to you?
In addition to these basic documents, most people need to do a little more. This is because protecting assets for our children or other beneficiaries and avoiding unnecessary court costs and legal fees upon your death or disability cannot be accomplished if you stop here.
As of January 1, 2016, there is a federal estate tax exemption of $5,450,000 and the Illinois estate tax exemption is $4,000,000. This is great news for most people, eliminating an estate tax as a concern, but you may be surprised by the time you add up life insurance policies, real estate, retirement accounts, CDs, brokerage accounts, and other assets how close you may be to these amounts. Even if you are nowhere near these exemption amounts, there is a lot of planning you can do to protect yourself and your family from unnecessary expenses and disputes, creditors, and divorce, and possibly take advantage of income tax and capital gains tax planning strategies that are available.
There is no time like NOW to review your documents.
Consider this — If you are married and have estate planning documents (e.g., revocable living trusts with “A-B trusts” or “Marital and Credit Shelter Trusts”) that were done years ago, back when the estate tax exemption was somewhere between $600,000and $2,000,000, you are likely to have a result that you do NOT want when you or your spouse passes away. This is because those trusts were designed to work for you when we had a much lower estate tax exemption, but should probably be updated to reflect the current laws.
We would be happy to sit down and talk with you to see how we can help you keep that New Year’s Resolution and get you where you need to be so you can rest assured that you have taken steps to provide for yourself and your loved ones. Please feel free to call our office at (847) 253-8800 to schedule a no-charge initial consultation.
Waltz, Palmer & Dawson, LLC is a full-service law firm with various areas of service to assist your business, including: Employment Law, Intellectual Property, Commercial Real Estate, Business Immigration, Litigation and general Business Law services. Individual services include Estate Planning, Wills and Trusts, Probate, Guardianship, Divorce and Family Law.
This article constitutes attorney advertising. The material is for informational purposes only and does not constitute legal advice.