When you plan your estate, there will be a legal document at the core that you use to state your wishes regarding the distribution of your monetary assets. For most people, it will be a last will, and there are others that use trusts of various kinds.Making your decisions known can seem like the long and short of it, but you should certainly take the estate administration process into account. If you use a will, you would name an executor to act as the trust administrator after you are … [Read more...]
Estate Taxes 101
Many people have questions about the way that taxes come into play when an estate is being distributed. It may be natural to assume that an inheritance would be looked upon as taxable income by the Internal Revenue Service. In a rare instance of good news as it applies to the tax man, generally speaking, direct inheritances are not subject to regular income taxes.Another positive is the way that appreciable assets are treated when they are changing hands after someone dies. If you were to … [Read more...]
Make Your Own Plan
Planning is important. If you don’t plan, your assets go pursuant to the state’s default plan, which may be very different from what you want. If you plan, you can be sure your assets go exactly to whom you want and in a manner that can benefit them the most.Make Your Own Plan … [Read more...]
Why Choose a Living Trust Over a Last Will?
The last will is the most common estate planning document, and a lot of people think that it is the only logical choice unless you are extremely wealthy. They are aware of the existence of trusts, but they are under the impression that trusts are very expensive to create and unnecessary for the majority of families.In reality, this is nothing more or less than a widely held misconception. There are trusts that are intended for multimillionaires that are exposed to the federal estate tax, and … [Read more...]
Estate Taxes and Real Property
Financial success is a beautiful thing, and it is a good feeling to be able to leave behind a legacy for your loved ones to draw from after you are gone. This being stated, there are looming threats in the form of death taxes.Generally speaking, inheritances are not subject to regular income taxes, but there is a federal estate tax that can have a significant negative impact. This levy carries a 40% maximum rate, so we are not talking about a barely noticeable nibble. The high rate is the … [Read more...]
Don’t Make Assumptions About Trusts
People often harbor misconceptions about the nuances of estate planning, and this can lead to bad decisions that yield negative consequences. One of them is the idea that you would never want to use a trust unless you are extremely wealthy. Folks that are under this impression assume that a last will is the only logical choice if you are not a multimillionaire.There is a kernel of truth in this line of thinking. High net worth individuals do use trusts of various kinds to satisfy complex … [Read more...]
Will My Heirs Pay an Inheritance Tax?
Taxation would logically enter your mind when you are contemplating your legacy, and most of the news is surprisingly good when it comes to taxes on inheritances. First, an inheritor does not have to report a bequest as taxable income, and appreciated assets that are inherited get a step-up in basis.What is a step-up in basis, you ask? The best way to explain is by way of a simple example. Let’s say that your grandfather bought some stock that cost him a total of $10,000, and he leaves you … [Read more...]
529 Plans: Planning for Education with a Tax and Asset Protection Bonus
Planning is important when providing for your children or grandchildren. But planning for their education has special importance and may have special advantages. This article looks at how 529 plans may have tax advantages when providing for education. Further, the article looks at how such a plan may provide asset protection in bankruptcy, as well.529 Plans: Planning for Education with a Tax and Asset Protection Bonus … [Read more...]
Planning for the Unexpected
It’s important to have a plan. If you don’t have a plan, your state law dictates who gets your property and makes decisions for you. Read on to learn more about the prevalence of unexpected deaths and an example of what can happen without planning.Planning for the Unexpected … [Read more...]
Planning for Education Expenses
Planning is important when providing for your children or grandchildren. But planning for their education has special importance and may have special advantages. This article looks at how a trust can be used to provide for your child or grandchild’s education. The article looks at how a trust can protect those funds.Planning for Education Expenses … [Read more...]
