Estate Planning Is a Lifetime Process, Not Just a Tax Saving Action

Estate Planning Is a Lifetime Process, Not Just a Tax Saving Action

Estate Planning is a lifetime process, not an after-tax distribution program. You should periodically review your estate planning goals and documents to minimize the impact that the bumps in life can cause to your estate planning.

Following is a checklist of some life-changing events or activities that could affect your estate planning needs:

1. More than two years since you reviewed your estate plan.
2. Death or incapacity of a spouse.
3. Death or incapacity of an executor, trustee or guardian.
4. Marriage, remarriage or divorce.
5. Marriage, remarriage or divorce of a beneficiary.
6. Birth or adoption of a child or grandchild.
7. Acquisition of substantial life insurance.
8. Relocation to another state or acquisition of property in another state.
9. Serious illness of a family member.
10. Change in business interest or retirement.
11. Financial irresponsibility of a child.
12. Changes in federal and state estate tax law.

Except for #12 above, estate taxes are not, and should not be, the major issue in a client’s planning. Further, whether or not the estate tax is eliminated, there have been no proposals to eliminate the gift tax which will still need planning. Also, the federal actions do not affect state inheritance and estate taxes and these too need to be planned for. Without the proper plan and documents, the tax payments could turn out to be the least of the problems for heirs. Review the above list with your advisors to make sure your wishes will be fully able to be carried out.

The above originally appeared in the Spring 2017 Withum Journal and has been updated for inclusion here. It was prepared by Hal R. Terr, CPA, PFS, CFP®, AEP® and Withum Partner who can be reached at [email protected].