Preserving Wealth
It is much more fun to accumulate and develop our assets than to talk about giving them up. When you transfer your personal circumstances into a well drafted estate plan, you are creating a legacy for the benefit of your family. Thank about some of the following questions when creating or updating your estate plan:
My family
Have I assessed the character, abilities and needs of my family and each of its members?
My Spouse
• Is she my primary beneficiary?
• What is her life expectancy?
• How long will she need support?
• Has she the ability to manage and invest property?
• Should property be left to her outright or in trust?.
My Children
• What is the educational status of each child?
• Have I supplied sufficient funds to assure that each child can complete his education?
• Does one child require special consideration because of disability or handicap, or,
because of special education requirements?
• If they are adults, have they had experience in the management and investment of the
property?
• Are they stable and reliable?
• Should property be left to them outright or in trust? If in trust, should distribution
of principal from the trust be made to them when they reach certain ages, or
should it be kept in trust for life?
Conservation
• Taxation
• Am I using available tax shelter opportunities to reduce the combine total family
income tax during my life and after my death?
• Am I using available tax shelter opportunities reduce estate and inheritance taxes?
• Do I know how much the estate taxes and administration costs on my estate will be?
Have I had my advisor do a hypothetical administration (dry run) of my estate to
determine these costs?
• Are the transfer patterns of the estate of both my wife and myself integrated so as to
incur minimum transfer expenses in both?
• Should I make lifetime transfers of property in order to reduce the size of my taxable
estate?
• Am I using the maximum marital deduction? Should I?
• Will there be a double taxation or even triple taxation on some part of my property,
both in my estate and in m spouse’s estate?
• Should I use charitable planning to reduce estate taxes and increase cash flow during
my lifetime?
Liquidity
• Have I calculated the amount of cash which will be needed to pay estate taxes, expenses
and debt?
• Will there be sufficient liquid assets to pay for these items?
• If not, what steps shall I take to provide the necessary cash?
• Should I rearrange my investments to make them more liquid?
• Do I need more insurance?
Management
• When was the last time I discussed my estate and my objectives with an attorney,
accountant, financial advisor?
• Have we carried out the plans we made?
• Have I ever had a conference call of all my advisors to work out an integrated, overall
estate, financial and tax plan?
• Have I arranged for efficient management of my estate after death?
• Have I appointed executors and trustees who have both a personal interest in my
family’s welfare and the experience to do an efficient job of investment and management?
• Should the investment duties and discretion income and principal be placed in the hands
of different fiduciaries?
• Does the guardian I have named for my minor children possess the necessary skill and
experience in financial matters?
• Have I arranged for successor fiduciaries?
• Have I given my executors and trustees broad powers to handle any changing requirements
of my estate and my family?
• Have I properly titled my assets to coordinate with my financial and estate plan?
• When was my will/trust executed?
• When was it last reviewed by me and my attorney
• Have any changes occurred in my business or family situation or the law which would
require changes in the will/trust provisions?
• Have I made an inventory of property and have integrated the transference of these
types of property with my will and/or trust so that my objectives will be achieved?
• If my spouse has property of her own, should I use the maximum marital deduction?
• Does my will/trust provide for distribution of my property either outright or in trust,
in such a way as to meet the specific needs of each of my beneficiaries?
• Does my will/trust have a common disaster clause?
• Have I provided a guardian for minor children?
• Have I exercised any powers of appointment which I may have? Do I want to?
• Have I provided that adopted children or descendants shall inherit in the same way as
natural born ones?
• Have I provided that estate and inheritance taxes shall be paid out of the residuary
estate and shall not be apportioned amount any beneficiaries? Do I want to?
• Have I considered the effect of any inheritance I may be receiving?
Lifetime considerations like Health Care Proxies, charitable contributions, and business interests entail asking many questions. By asking questions; the answers will follow and your planning will develop.
Steven W. Tarta, Esq. brings more than 45 years of professional experience to his practice, with a sophisticated focus on Estate Tax Planning, Living Trusts and Elder Law.