It can be daunting to start planning ahead for your family’s future and considering your own mortality. Having a solid estate plan in place can be beneficial when the time comes, and a reliable estate planning lawyer can help you create a plan that provides comfort and peace of mind. However, you may want to look into common estate planning mistakes to avoid in Boston, MA.
In simple terms, estate planning is the establishment of a plan for the distribution of your assets when you pass away. It informs the probate court of your wishes and legally binds the court to abide by them accordingly. An estate plan often includes a last will and testament, provided it meets the necessary requirements, as well as trusts, power of attorney, and other important elements unique to your situation.
According to recent data gathered from the U.S. Census Bureau, the median household income in the state of Massachusetts is around $101,000. Many households, especially those with a higher income, may plan to put together an estate plan that ensures their families are taken care of. If you have already started to prepare your family for your passing, you may want to look into grief support groups in Massachusetts, such as GriefShare.
When putting together an estate plan, you’ll want to maximize the value of your estate, ensure your assets aren’t highly taxed, and make sure the right people benefit from your estate. There are many different mistakes you could make that would jeopardize the trajectory of your estate plan. With the help of an experienced lawyer, you can avoid these estate planning mistakes. Here are some common estate planning errors:
The five by five rule in estate planning refers to a clause you may choose to include in a trust document. This clause ensures that the designated beneficiary can only withdraw either $5,000 or 5% of the trust’s fair market value every year. Generally, they can choose whichever is greater. This is done to ensure the beneficiary has limited access to the trust and can’t withdraw the entire amount at their leisure.
There are many ways you can try to avoid inheritance tax in Boston, Massachusetts. One of the most reliable ways is to make gradual financial gifts to your family members over time. As you do this, the size of your estate will diminish. If the estate is worth less than $2 million by the time you pass away and your estate is ready to be inherited, it will no longer be taxed by the state.
The three-year rule in regard to estate planning refers to a clause in the Internal Revenue Code. It dictates that if you make a gift of your assets within three years of your death, those assets will be included in the gross estate for estate tax purposes. This is in place largely to prevent people from avoiding estate taxes by transferring assets before their death.
Making a will can be a difficult process, and it’s important to understand the dos and don’ts of putting one together. You should always be specific in your wording and your beneficiaries. Be clear about which parties you want to inherit your assets, as well as what you would like them to inherit. Don’t include your own personal feelings or sentiments. A will is not an opportunity to share your intimate feelings with the ones you love or tell off the ones you dislike.
It’s important to recognize all the potential mistakes you could make when crafting your estate plan. An experienced estate planning lawyer can inform you of everything you should do to ensure your plan is sound and enforceable.
The legal team at Albanese Law, LLC, can help you build an estate plan to ensure that your estate is distributed in accordance with your wishes. The last thing you want is to pass away without an estate plan in place. If this happens, it will be up to the court to determine how your assets are distributed, and their decision may not align with your wishes. With the help of a good lawyer, you can establish a strong estate plan that reflects your wishes.
Albanese Law, LLC, can help you build a solid estate plan that includes a will, a trust, power of attorney, and everything else you need to ensure a smooth distribution of your assets. Contact us to speak to a team member about your case.