Happy New Year

From our family to yours, happy holidays and a safe and successful New Year.

We'll be back in 2018 with more of our insights and explanations of the estate planning process.

New Year - Resolve to Review your Estate Planning

Today we reprise a New Year's blog from 2015 because we feel that it is important that planners and clients add a commitment to review and update their estate planning to their list of New Year's resolutions.

The importance of this resolution really struck home with me when I reviewed my own estate planning on New Year's Day and realized there were changes I wanted to make even though the most recent revision had occurred less than two years ago.

Our message from that 2015 blog continues to be relevant:

"While we all have full lives that often get in the way of planning, the beginning of a new year is a great time for our clients, friends, and me, to make a resolution to review or consider estate planning.   It is particularly important to: 

1.    Review estate planning documents especially if they have not been updated in the last two or three years. If you have no documents, it is time to consider getting them. Pay special attention should be paid to:

a.    Guardians named to care for minors in the event both parents pass away. If you have previously named guardians, are these still the people you trust?

b.    Distribution provisions for children and grandchildren --when should they receive money and how much?

c.    People named to act as trustees and personal representatives after your death to protect your children and other loved ones. Are those people you named to administer your trust and estate still the ones you want to accept that responsibility?

d.    People named to make legal and medical decisions under your Durable Power Of Attorney and Patient Advocate Designation, in the event you become incapacitated. If you have previously named people, are they still able, and willing, to make these decisions on your behalf?

2.    Review how you titled your assets to confirm you can avoid the high cost, time delays and public exposure of probate under Michigan law at your death.

3.    Inventory your assets, so that a complete list is available for your administrators in the event of a sudden death.

4.    Consider making a list of personal property designations, so that items you value can go to the desired beneficiaries.

5.    Consider making a list of important people and contact information, such as your attorney, accountant, financial planner, or investment advisor, to save your family time and aggravation.

6.    If you have any particular desires, write a letter indicating your personal burial preferences, so your loved ones will know how to handle arrangements at your death.

7.    Consider starting Section 529 education accounts for your children or grandchildren so the funds can grow tax-deferred, and be distributed tax-free, to the extent they are used for higher education.

8.    For those of you with unmarried children over the age of 18, encourage them to execute their own patient advocate designations and durable powers of attorney so that if something were to happen to them, decisions can be made without involving the probate court.

Like all of our other resolutions, these may be hard to keep but, if completed, can provide us peace of mind that if the unexpected occurs, our loved ones will be prepared to deal with whatever comes their way."

A Happy New Year from Plainly Legal

When I sat down to write this post around noon on December 31, I intended to use today to write about the current state of the law affecting estate planning. As you likely know, one part of the Fiscal Cliff is the expiration of the present law regarding the taxes paid on transfers of wealth at death, the Estate Tax. Tied to the Estate Tax is the Gift Tax, which taxes certain transfers of wealth during a person’s life. If Congress does nothing, when the present law expires the new threshold for estate taxation in 2013 will be $1,000,000. This means that estates with a value over $1,000,000 and lifetime gifting (with some exceptions) over $1,000,000 will be subject to taxation. The rate of taxation is also set to increase from a maximum rate of 35% of every dollar over the threshold to a maximum rate of 55% of every dollar over the threshold. This is just one of the results of the nation “going over” the Fiscal Cliff and I could spend a month of posts explaining those results.

However since as I was writing this post, Congress had not managed to find the collective moral courage to set aside partisan bickering, care more for the good of the nation than their own job security, and fulfill their oath to the American people, I find it difficult to articulate the state of the law. Ultimately, no matter what the law is as the sun rises over Washington, D.C. this New Year’s Day 2013, it can (and likely will) change. Tax rates and thresholds can be set retroactively, the difference between a tax increase and tax cut depends on the day of the week the law passes, and the nation’s economy will not split like the hull of the Titanic in the course of a single day or even a single month. Instead of a dry recitation of statutory interpretation I have for you three thoughts:

1. It is a new year. Take a moment to assess your goals from the past year, see how you did in achieving what you set out to do. Once you know where you came from, it is easier to plan for the future, so start achieving your 2013 goals today. Whatever else you do with the day is up to you, but I suggest spending it with friends and loved ones. There are 364 more days to spend making money, helping others, and fixing the dripping sink,  so why not start the year off with a little enjoyment.
2. Thank you for your trust and support. We have been writing this blog now for a little over three months and we intend to continue writing it for many more. Thank you for continuing to use us as counselors, advisors, and attorneys. It is our greatest pleasure to serve you, your families, and your clients. We truly appreciate it when we receive new clients through your referrals. If there are areas of estate planning, business planning, or other law that you would like to see us discuss here, please do not hesitate to let us know in the comments or by email.
3. Go team! As we go through the season of college football bowl games and NFL playoffs, may your team  score enough points to beat their opponent (or if you are so interested, just beat the spread).

A Happy and Successful New Year to you, your family, and everyone else in your life from everyone at Finkel Whitefield Selik and the Plainly Legal blog.

Al Ferrara

Matt Ferrara