Year-End Estate Planning To-Do List

/ December 5, 2015

Man Looking At Tablet - iStockThe end of the year is an ideal time to review your current estate plan and confirm that you are taking advantage of all planning opportunities available to you. This includes not only tax planning, but also asset protection, probate avoidance, beneficiary designations and changes in your family and financial situations. On the other hand, if you do not have an estate plan in place, it is important to initiate the conversation with your estate planning attorney to begin the process. In most cases, the estate planning process can be far simpler than expected and provide significant peace of mind once completed.

Review Your Existing Estate Planning

Not knowing the terms of your estate planning documents can be as dangerous as not having an estate plan in place. Whether you review your documents or a summary created by you or your attorney, it is important to know the decisions that you have made because the terms of your documents will dictate how your estate is divided and administered as well as who will make decisions on your behalf if you are unable to do so. While properly drafted documents should be flexible to account for changes in federal and state tax laws or the birth of additional children or grandchildren, not all scenarios can be foreseen or drafted into documents. Some examples of circumstances that may affect your documents include:

  • strained relationships;
  • marital, creditor or substance abuse issues of a beneficiary or agent;
  • poor health or death of one or more agents, guardians or trustees; or
  • changes in your financial situation or wishes for the distribution of your assets.

An annual review of your existing estate planning documents is important to ensure that your documents continue to accurately reflect your wishes.

Take Advantage of Expiring Exclusions

The annual gift tax exclusion—which allows an individual to make gifts of up to $14,000 in 2015 to as many people as he or she chooses without incurring any gift tax liability—expires on December 31st and cannot be recovered. If you have established an instrument to make such annual gifts, such as a gift trust, or wish to do so, it is important to utilize your 2015 exclusion by December 31st so that it is not surrendered. Additionally, the lifetime federal estate and gift tax exemption will be increasing from $5.43 million in 2015 to $5.45 million in 2016. If you are utilizing the lifetime exemption, planning such gifts as early as possible will remove future appreciation from your taxable estate.

Create or Update Your Estate Planning

If you have yet to cross “estate planning” off of your 2015 to-do list, have questions regarding your existing documents or have changes to be made, it is important to contact your estate planning attorney and begin the process. Estate planning is one of the most common victims of procrastination and not having a current estate plan in place can have significant personal and financial consequences. Loose ends or ambiguities can lead to family conflict and avoidable litigation. If you do not have an estate plan in place or suspect that your existing documents may require an update, begin by contacting your estate planning attorney to discuss your estate planning needs.

This article was originally published December 1, 2015 by Manish Bhatia on