Top Ten Fatal Estate Planning Mistakes
1. No plan at all:
90% of Americans have no plan at all. Planning protects yourself, your loved ones and your hard earned assets.
2. Failing to plan for disability:
Estate Planning is more than merely planning for after your death distribution of your assets, a full comprehensive Estate Plan includes a plan for your own incapacity. Who will take care of you and look after your loved ones and your assets.
3. No guardians/back-up parents:
Your children are your most valuable assets. Should both parents die while your children are minors who will take your place and raise your children until they reach adulthood?
4. No creditor protection:
You worked hard for your assets and saved for your family. Failure to incorporate creditor protection in your Estate Plan puts your assets at risk of being squandered by your surviving spouse's new spouse, your children, their divorces, lawsuits, creditors, or bankruptcies. You want your children and grandchildren to benefit from your legacy.
5. Assuming there is no estate tax problem:
Assuming anything about what the law will say in the future is never a good plan. The tax law that is in effect upon your death will determine the amount of your assets that you can lawfully protect from federal estate taxes through proper Estate Planning.
6. No estate tax planning for life insurance:
Life insurance death benefits may be income tax free for the beneficiary, but the entire value of the death benefit may be part of the policy owner’s estate for estate tax purposes. Proper planning can be structured to avoid estate taxes and still fulfill objectives.
7. Probate avoidance planning for multi-state real estate:
If you own real estate in more than one state, then that real estate is subject to probate in those states before transferred to your loved ones. This is a costly and timely consuming process.
8. No income or estate tax planning for retirement plans:
Employer sponsored retirement plans, private, individual qualified retirement plans, and one’s estate. If there is not proper coordination between these plans and your estate the impact of taxes could be substantial.
9. No business succession planning:
70% of family businesses fail to survive from generation to the next. For your business to continue with your family, business succession planning must be included in your comprehensive Estate Plan.
10. No tax-savvy lifetime giving programs:
The annual gift exclusion allows you to give $12,000.00 each year to as many individuals as you desire. You can do this without incurring gift taxes on those gifts. This exclusion removes the value of the gift from the value of your estate.
William R. Black, PLLC
4250 NE 16th Ave. Oakland Park, FL 33334
Phone (954) 745-7986 Cell (754) 224-9002 Fax (954) 745-7985