I have been reading lately that since the current Estate Tax exemption is $5.25 million, there is little to no reason to properly plan your estate. Since the government currently allows a person to pass $5.25 million to anyone without paying estate taxes, many purported pundits minimize the value of estate planning.
But this is simply a shortsighted perspective. Yes, we would all like to reduce our tax bill, and it is terrific that the current estate tax laws help us do that. But proper estate planning provides so much more. Even for those of us with modest estates.
First of all, with a proper plan, you can avoid probate. Probate is court. And, I don’t know about you, but even as a lawyer, I want to avoid court – so I always presume, so do my clients. Probate can be expensive, time consuming, and the information is public record.
Next there is providing protections for the beneficiaries. Without proper planning, the assets that you worked hard to accumulate to provide for your loved ones can evaporate the second the funds land with your beneficiaries. Without proper planning a creditor (think lawsuit!) can reach right in a take your loved one’s inheritance.
Then there is long-term care protection. Having a proper plan in place can help mitigate against the risk of the costs of long-term care. The cost of care rises every year, and with the advances in medicine we are living longer and longer (think about all those centenarians you know!). A properly drafted plan can help reduce the risk of you dying destitute.
Then there is Congress. That fickle crew we elect to run our country seems to change its collective mind more frequently than day changes to night. So planning for estate taxes, though not currently an immediate issue, should be contemplated to be ready for the whims of Congress.
And this is just to name a few of the reasons proper estate planning is important, even in today’s climate of limited estate taxes. Now is the time to make sure your plan meets your objectives.
For more information, or to schedule a free consultation, contact our office at 888.222.1328.
Contributed by MH Albuquerque, Las Cruces and Santa Fe Estate Planning Attorney, James P. Pliz.
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The attorneys at Morris Hall have 100’s of years of combined experience ensuring that families’ assets are protected from probate, unnecessary taxes, creditors, ex-spouses and Medicaid spend-down. The attorneys also help those in Arizona and New Mexico to apply for and receive Medicaid assistance and Veterans Benefits. 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.