Beatrice E. Wolper, Emens & Wolper Law Firm
People talk. …and ponder. And consider…and don’t do IT. No one REALLY likes to discuss what should happen at death. In addition, so many people are overwhelmed at the thought of making decisions about “who gets what and when.” But, this is the time to act….to do IT. This year. If congress does not change the course of events for estate and gift tax…the opportunity to save large sums of money on taxes will go away.
You’ve read about this now for a year! Before 2013, a person can give up to $5,000,000 to another person…without any federal tax on the giver or receiver! (And if married, this amount is $10,000,000) Without Congress changing the law, the amount decreases to $1,000,000 on January 1, 2013 (with any amount over that given in life or death taxed at 55%.)
If you are thinking…”I don’t have $5,000,000”…. You can still take advantage of gifting (over the annual allowed amount of $13,000) without any federal tax on the giver or receiver.
So, how do you start to take advantage of this opportunity? First, think about WHY it would be important to you to make sure where and when your money goes. Why it is important to you to save taxes. The more you understand the reasons, the more committed you will be to get IT done. Organizational specialist Smallin refers to “ACT” —Access your situation, Commit to a plan and Take action!
Sometimes people freeze in their decisions because they are afraid they may “run out of money.” Good estate planners can help thaw those decisions…by determining what is necessary and what is discretionary. How much is “enough.” …enough to take care of yourself and your spouse? Enough to take care of children? Enough to take care of grandchildren? Enough to take care of your favorite charities?
Sometimes people believe an estate plan isn’t necessary. But, if you have minor children, or want assets to go to a particular person or place, or want to provide for certain important “life” decisions (such as a living will or durable power for health care), then one is necessary.
Sometimes people believe that an estate plan is too complicated. Unless you are a Rockefeller, it is not.
Sometimes people believe their spouses would automatically inherit. That may be true under the right circumstances, but why not make sure?
Sometimes people believe it is too expensive. It is not.
If you don’t know where to start, ask a friend. Make a call to someone you trust…the first step may be as simple as making the phone call.
With planning, an individual can SAVE TAXES and reap emotional and financial rewards. No decision is a decision. Do IT.