Top 10 Estate Planning Mistakes – And All of Them Can Be Easily Corrected
October 17, 2006
To err is human and to correct is divine. If you have an existing estate plan and haven’t revisited it for several years, or you never thought you needed one, there is no time like the present to fill that gap. You can address past oversights and begin creating an effective plan that protects your interests and those of your heirs.
Since no one has a crystal ball to tell what the future holds, here is a list of ten common estate planning mistakes that can be easily be corrected.
- Failure to accurately determine your taxable estate. It is important to understand what assets are taken into consideration in determining your taxable estate. Assets such as real estate, stocks, bank accounts, IRAs and life insurance are all included in your taxable estate. By not properly valuing it you could be subject to a significant amount of estate tax, thereby reducing the amounts that could be left to your family and friends. It is crucial that you make yourself aware of the available estate planning options that could reduce or even eliminate potential estate taxes.
- Failure to recognize recent changes to the Massachusetts estate tax law. Massachusetts recently “decoupled” its estate tax from the Federal estate tax, which means that your estate could be subject to MA estate tax even if no Federal estate tax is due. Since the Federal estate tax exemption is currently $2 million and the MA threshold is $1 million, without proper planning, this variance could result in an unpleasant surprise for your heirs upon your death. It’s a good idea to review your current financial situation to determine the potential exposure to MA estate tax and how to minimize it.
- Failure to plan for a physical or mental disability.
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by: Brett A. Kaufman, Esq.
October 2, 2006