Updated: January 7, 2022
With the “Tax Cut and Jobs Act” passed in December 2017, many thoughts and ideas related to estate planning strategies changed (especially with the December 31, 2025 sunset where the estate tax breaks would end). With Biden’s discussion of his “Build Back Better Act” (not yet passed), that accelerated the discussion into year-end 2021. That being said, it is a great time to see if your Estate Plan is up to date – both in term of tax law AND in terms of your goals and distribution objectives. Estate planning is a vital component of every financial plan, regardless of the size of the estate. Unfortunately, it’s also an area that is commonly overlooked. This often results in wasted dollars and emotional hardship that could otherwise be minimized with proper advance planning and action.
Simply stated, estate planning is a method for determining how to distribute your property during your life and at your death. It is the process of developing and implementing a master plan that facilitates the distribution of your property after your death and according to your goals and objectives.
At your death, you leave behind the people that you love and all your worldly goods. Without advance planning, you have no say about who gets what, and more of your property may go to others, like the federal government, instead of your loved ones. If you care about (1) how and to whom your property is distributed, and (2) ensuring that your property is preserved for your loved ones, you need to know more about estate planning.
As a process, estate planning requires a little effort on your part. First, you’ll want to come to terms with dying, at least to a degree that you can deal with the necessary planning. Understandably, your death can be a very uncomfortable subject, but unfortunately, the discussions in this area are full of references to your death, so it really can’t be avoided. Some statements may seem too businesslike and unfeeling, but tiptoeing around the subject of
dying will only make the planning process more difficult. You will understand the process more easily and implement a more successful master plan if you approach it in a straightforward manner.
To give you some education on this topic, we have created a few articles for your easy reference on this important topic. Please take the time to read them and call or email us with any follow-up questions:
- Introduction to Estate Planning
- Key Estate Planning Documents You Need
- The 2018 Estate Tax Rules and Your Estate Plan
- Estate Planning and Income Tax Basis
- Asset Protection in Estate Planning
- Life Insurance in Estate Planning
- Business Succession Planning as Part of Your Estate Plan
- How the SECURE Act Impacted Retirement Plans in your Estate Plan
- Legacy Planning – Incorporating Charitable Giving into Your Estate Plan
- Private Family Foundations