The big news for all New Jersey residents is that effective January 1, 2018, the New Jersey estate tax is no more! The federal exemptions have also doubled to nearly $22 Million.
This provides a good reminder that we need to use opportunities like this to revisit our estate plans regularly. Only 20 short years ago, both the state and federal tax exemptions for estates were very low (circa $600,000.00). As a result, many people who had documents prepared in the past may have complex wills or other sophisticated tax planning documents in place that are either no longer required or unnecessarily complicate their estate plans. What a great time to update all of your estate documents to insure you have only what you want and need.
An estate plan is about more than minimizing tax obligations
Even if you did not employ complex tax-savings measures in a previous estate plan, other issues may require reconsideration. For example, you may need to update beneficiaries for your life insurance policies, 401(k) or similar retirement accounts. Maybe since last tending to your estate documents you have been married, divorced or remarried. Perhaps you’ve had children or added to your family, or the children you had are no longer minors. These life changes can greatly influence your estate plan — not only to whom your property and money are distributed, but also who will act as your executor, health care proxy and power of attorney. For example, it may now be time for an adult child to be your first choice as executor, rather than a previously listed spouse, sibling or other relative.
Now is also an excellent time to revisit issues such as end-of-life care. You may want to update your medical power-of-attorney and medical preferences to ensure these vital documents meet with your current needs, beliefs and medical advancements.
Estate plans are unique to your circumstances, and circumstances change
The best estate plans are dynamic and change along with your circumstances. Simple life events such as being in a sounder financial position, having one or more children (or grandchildren), getting divorced or retiring could easily render previous estate plans and accompanying choices obsolete. Worse, they can lead to your money and property being distributed in a manner not exactly of your choosing.
Many people use the new year to mark a time of new resolution. There is no better time to pledge getting your financial and personal “house” in order than now. Any such resolution would be incomplete if your estate plan is neglected. A properly conceived and updated estate plan is a vital tool to protect your future and your family’s emotional and financial well-being.
Contact us now. Let us show you how we can create or update an estate plan that’s perfectly tailored to your needs and family. There’s no time like right now to get started.