Every day in New Jersey and across the country, people are involved in serious accidents or contract serious illnesses. Some of those people are unable to make healthcare decisions for themselves during these times -- at least temporarily. This is when family members can turn to the incapacitated individual's estate plan for his or her living will in order to ensure that family members and physicians are aware of that person's wishes. Without a living will, family members are often left to make decisions that person may not have wanted. Further, they may have to go to court in order to be granted the right to make decisions on that person's behalf, and that could waste valuable time during which decisions need to be made.
Most New Jersey residents want to provide for their loved ones when they pass away. However, many people make certain assumptions when it comes to estate planning that can ultimately deny a family the inheritance an individual intended to leave behind. Two of these mishaps are failing to plan at all and not changing beneficiary designations on certain accounts and insurance policies.
For some New Jersey residents, choosing the people to represent them in the case of incapacity or death is more difficult that making other estate planning decisions. These people could literally be making life and death decisions on an individual's behalf. When creating an estate plan, time should be taken to carefully consider these choices.
Back on Feb. 26, we wrote about Philip Seymour Hoffman's estate ("Where did Philip Seymour Hoffman's estate planning go wrong?"). More details recently came to light regarding why he may have set up his estate the way he did. Reportedly, he was adamant about not allowing his children to be considered "trust-fund kids," and his estate planning reflects that. Some New Jersey residents may not know that his children were not among the heirs to his estate. Virtually everything will pass to his partner of many years, to whom he was not married.
There are many reasons for transferring assets during life. No matter what your reason may be for wanting to transfer your assets, it is my job to consider the relevant factors and possible implications of such transfers. Below are some examples of common transfers made with specific planning objectives that could lead to big problems- especially if you need long term care such as that offered by an Assisted Living Facility or Nursing Home.
For numerous New Jersey residents, estate planning does not end with wills and trusts. Most retirement accounts -- including IRAs -- life insurance policies and annuities are not governed by those documents. They require the account owner to fill out a beneficiary designation, but if an individual is not careful, beneficiaries may not receive the inheritance intended for them.
Virtually every parent in New Jersey wants to see his or her children grow up, and most will get that chance. However, there are no guarantees in life, and estate planning becomes crucial for parents who have minor children. Without any plan in place, family members could spend a significant amount of time and money in court in certain circumstances.
Virtually everyone in New Jersey and nationwide has heard of the Kennedy family, which was made infamous through the political aspirations and tragedies surrounding the children of the family's patriarch, Joe Kennedy. Another thing for which the Kennedys are known is their vast wealth. It was the foresight of Joe Kennedy and the trusts he founded that may keep Kennedy heirs wealthy for decades to come.
The simple fact is that many New Jersey couples will never have to worry about federal estate taxes. This is because the federal estate tax exemption is $5.34 million per person, and a marital exemption from estate tax exists. For this reason, many couples' estate planning does not necessarily need to focus on avoiding these taxes.
Many New Jersey residents consult someone knowledgeable in estate planning to draft even a basic estate plan consisting of a will, powers of attorney for health and finances and trusts. However, fewer people consult anyone when they fill out beneficiary designations for accounts such as insurance policies, bank accounts or retirement accounts. These forms are just as important -- and in some cases even more important -- in estate planning as any other document.