I recently received some wonderful news that some family members of mine are moving to Arizona! While they already have a lot on their plate – finding a new place to live, arranging for movers, packing their belongings, cleaning the old home…etc. – one item they should not forget about, once they get to Arizona, is to review their estate plan. Within your estate plan, two of the most important items that must be reviewed are health care directives as well as community property treatment.
Health care directives – health care power of attorney, mental health care power of attorney, HIPAA release and living will – should be redone using the laws of the state you have moved to. Many states have statutory forms which medical professionals are accustomed to relying upon. Your existing health care directives are not invalid when you move to a new state, but questions may arise if another state governs the directives.
Additionally, if you are moving from a separate property state to a community property state, you may choose to rework your estate plan to take advantage of the community property tax treatment. Community property treatment can lead to significant tax savings for a surviving spouse. With community property treatment, all assets receive a step up in tax basis as opposed to only the deceased spouse’s assets receiving the step up in tax basis. This can significantly reduce capital gains tax exposure for the surviving spouse.
It is also a good time to review your estate plan to ensure your assets are correctly tied to your estate plan. If you have a revocable living trust, you should verify that all current assets are titled in the trust name as well as update your schedule of assets to remove any reference to assets you no longer own.
About Morris Hall:
At Morris Hall, we have focused our legal practice on estate planning for over 40 years. Along with estate planning, our attorneys help clients and their families with matters of probate, trust administration, wills, power of attorneys, business planning, succession planning, legacy planning, charitable gifting and other important legal aspects. We also have divisions in financial, real estate and accounting to help you incorporate all of your planning together, ensuring that everything works perfectly for your needs and situation. Our Arizona offices are located in Phoenix, Mesa, Scottsdale, Cave Creek, Tucson, Prescott, Flagstaff and Arrowhead. Our New Mexico offices are located in Albuquerque, Las Cruces and Santa Fe. Contact us today at 888.222.1328 to schedule an appointment!
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.