Who’s going to receive your assets?

Transcript:

Estate Planning

[video description: Bar charts with "federal estate tax" sitting atop appear. Then an individual's silhouette appears next to $5,000,000 and a couple's silhouette appears below next to $10,000,000. ]

Now that Congress has set a high trigger point for the federal estate tax, it only hits single people who leave more than $5 million behind, and couples can pass on more than $10 million tax-free—you might think you can scratch estate planning off your “to do” list*.

[video: A red bubble appears showing "estate planning" text which starts to be erased until it is reverted and a teal bubble that says "federal estate tax" pops up next to it.]

Not so fast! Estate planning is about a lot more than the federal estate tax.

[video: A blue silhouette of a person is shown as the camera zooms out revealing multiple barricades in the path before showing another group of silhouettes at the end.]

Basically, it’s about removing the roadblocks that can stand in the way of getting your things to the people you want to have them, with as little hassle and expense as possible.

[video: Single person silhouette is shown in front of single barricade with text "lack of valid will".]

The number one barrier, of course, is the lack of a valid will that spells out your wishes. If you don’t write your own will, the state will write one for you. Not good.

[video: Another barricade appears with the text "need for cash" above. The barricade is then covered in blank forms.]

Next is the need for cash to cover the bills that must be paid before your assets can be distributed—your final expenses, for example, and any outstanding debts.

There’s more to think about, too.

[video: Single basketball player takes on a whole team in a half court and then makes a 3-point shot.]

Some possessions can be more difficult to pass on than others—it’s a lot easier to carve up a bank account among several heirs, for example, than a cottage in the woods. With proper planning, though, you can accomplish whatever you want.

[video: A ball chained to the word "tax" sinks in a pool of water. A car then drives off of the end of a bridge and plummets in to a canyon.]

Did you know that some assets go to heirs free of any income tax, but other parts of your legacy can carry a heavy tax burden? Or that giving property away while you’re still alive rather than passing it on via your will can be either a savvy move . . . or a big mistake?

[video: A stack of papers appears connected to a dotted line that says "estate plan".]

There’s a lot to think about, and there’s lots of help available. Putting together a solid estate plan can pay off with helping your piece of mind today . . . and in helping to ensure your wishes are fulfilled tomorrow.

This information should not be construed as tax or legal advice. Always consult with your tax or legal professional for details and guidelines specific to your situation.

*CCH Tax Briefing, January 3, 2013, American Taxpayer Relief Act of 2012

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