As your life changes, the contents of your will should change with it. After all, you want to ensure your assets are secure and your heirs are taken care of. But, there are some things that might be easy to forget about as you create and draft your will. Here are four areas to consider when that time comes.
As laws change, traditional estate planning advice might not always be appropriate for some Washington residents. For example, they might want to consider whether family members would benefit from an inherited Roth, which may pay out distributions for years.
Changes in the estate tax exemption may require changes in the estate plan. The exemption has increased to $11.4 million, and this could mean that an estate plan that was designed to avoid estate tax may no longer be necessary. However, people should be aware that in 2025, the exemption will revert back to $5.5 million. Congress could make it even lower. Furthermore, there could be income tax on retirement accounts, and this should be accounted for as part of overall estate planning. One option is to make a charity a beneficiary since it would not be required to pay the tax. Some people who purchased life insurance specifically to cover estate tax have been surrendering it, but experts say they should consider a life settlement transaction instead since this can be a valuable asset.
All interested parties to a will that was executed in Washington must be notified in the event of a will contest.Those who are listed in the document itself are considered to be actual parties to the will and must be included in the list of interested parties. Furthermore, anyone who was listed in a previous version of the document could also need to be informed of a planned will contest.
Generally speaking, anyone who is related to the deceased testator could be an interested party in this type of a probate matter. It is also possible that friends, colleagues or other people could need to be contacted about a will challenge even if they aren't listed in the will itself. Those who could be considered interested parties to the will contest have the option of participating in any case that makes its way before a judge.
When people in Washington have kids, they may start thinking about estate planning. Children inspire many people to make a will in order to help ensure the children will be provided for in the future. Still, many people choose not to have kids and live fulfilling lives. They may have even more time to dedicate to their careers and accumulate significant assets. People who are child-free may think that they don't need to worry about estate planning. However, most child-free people still have strong feelings about what they want to happen to their belongings after they pass away.
Making a will, trust or other estate documents can help child-free people to plan for the future. Making out a will can be especially important for long-term couples who choose not to marry. A partner may not be entitled to any belongings under state intestate provisions if there is no will leaving belongings to that person. Around 64% of people don't have a will, but it can be important for those who want to make sure their assets are directed correctly.
Some people in Washington have estate plans that include both a will and a trust. One of these is generally the main document for the estate, and each has its own advantages and disadvantages.
One of the main differences is that a will must pass through probate before property can be distributed to heirs. With a trust, assets pass directly to heirs. Trusts offer privacy while probate is a public process. This can leave a will more vulnerable to challenges, and it can mean that a will is subject to greater scrutiny in case of irregularities. There are fewer established rules in place for challenging a trust compared to challenging a will. Preparing a will is generally less expensive than preparing a trust, but depending on various factors, probate can be costly. Adding assets to a trust can be more complicated than including them in a will, and a common error is creating a trust and then failing to fund it at all.
Revocable living trusts are a good estate planning option for people here in Washington who are concerned about how their assets will be passed along if they are incapacitated by illness and unable to manage their own affairs.
A living trust enables the grantor to control their assets during the time they are alive and healthy, during a time of possible incapacitation and after their death. Some grantors manage their own trusts or work with an estate planning attorney.
When planning their estates, one thing that Washington residents often forget about is their pets. Despite the fact that nearly two-thirds of all Americans own at least one pet, animals are often overlooked in estate plans. If you fail to plan, your furry companion could end up in a shelter or worse. To ensure that their pets receive the right kind of care, individuals should consider these four suggestions.
The first is setting up a pet trust. Through a pet trust, owners can specify who will care for their animals if they die. It will also provide the funds for the person to do so. A durable power of attorney goes a step further by allowing a named individual to provide medical care for another person's pets. A durable power of attorney can also be used while someone is still alive but needs another person to act make decisions on his or her behalf. An example would be when an individual is hospitalized or away on business.
Estate planning is one of the things in life that people in Washington and around the country tend not to consider until they have to. It is not pleasant to think about or plan for death, but it is best to think about it sooner rather than later. When people fall ill unexpectedly, it can be a scramble to get affairs in order, and a basic estate plan can be established with only a bit of time and effort.
The first step in many cases is to contact an attorney who has experience in these types of matters. For people who own significant property, a trust may solve most planning needs. There are benefits and drawbacks to each type, including irrevocable and revocable trusts. Even after the plan is established, it is important for people to stay in contact with their estate planning attorneys. Plans may need to be updated as the person's family or financial situation changes.
Washington residents who want to save for retirement may want to consider using an individual retirement account. If they decide to use an IRA, one of the things individuals should consider is to whom the funds should be left when they die. Some individuals may consider designating a trust as their IRA beneficiary.
Individuals who establish an IRA with a brokerage will typically be asked to choose a beneficiary. It is at this time that they can designate their trust. For individuals who have a new trust, they can review their financial institution's online portal for instructions for modifying their beneficiary. Careful planning is necessary in order to name a trust, and consultation with a financial advisor is advised before doing so.
There are over 130 million people in the United States who suffer from a chronic ailment. Washington residents who have a chronic disease or a loved one who is chronically ill should make sure that their estate plan includes provisions that properly address health and aging issues.
The estate plans for people who have one or more chronic diseases should be the same as those for people who are not chronically ill. However, the estate planning documents should be modified or updated so that they are able to better address the needs of a chronically ill person. It is important that chronically ill people have the proper documents in place as soon as possible after receiving a diagnosis. Depending on the progression of their condition, their ability to comprehend and sign legal documents can be hindered.
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