You already have a terrific accountant who does your taxes every year and talks to you about retirement planning. You may be wondering if you should make an estate plan too, and if so, whether you need a lawyer. Lawyers handle many issues that accountants do not, and so planning for your future should involve both types of professionals.
Lawyers and accountants handle different issues
Lawyers handle legal questions and preparing legally binding documents, while accountant handle tax-only questions and prepare tax returns. They have different roles in handling your assets and needs. Some accountants work on estate tax returns and trust tax returns, so they have some familiarity with estate planning tax issues. Others only do yearly tax returns for individuals and businesses. In contrast, estate planning attorneys prepare wills, trusts, and powers of attorney for clients, and they represent clients in probate court. Some estate planning attorneys have extensive tax experience, such as a legal degree in tax (LLM).
A good estate plan includes advice and documents that accountants cannot provide
Since many accountants are not lawyers, they cannot advise you on legal questions without running afoul of California law. When someone is working on a complicated estate plan, his questions often cross over from being purely about tax savings to being questions of legal interpretation. At that point, he needs to consult a lawyer. Estate planning lawyers give legal advice about how to pass on estates to relatives under the law and how to minimize taxes owed on the estates. Their advice extends to lifetime decision-making such as charitable giving or setting up a power of attorney. Accountants cannot give this kind of advice and should not draft the necessary documents to make your plan happen.
Better to have a team coordinating their efforts to your benefit
The two fields of law and accounting have some overlap, so make sure your attorney and your accountant are on the same page about your plans. Often, legal questions about whether to choose a particular estate planning device depends on the tax benefits you could gain. Similarly, doing yearly taxes could raise questions about future planning to minimize taxes. You do not want a conflict between how each handles a tax-related issue, so coordinate with both of them. Give both professionals each other’s contact information and meet with them regularly to make sure they know about changes in your estate.
Do you have an accountant but need an estate planning lawyer? Look to Janet Brewer, Esq. for thorough and thoughtful estate planning advice. Janet’s more than 20 years of legal experience will give you confidence and peace of mind. To schedule a “Get Acquainted” meeting, visit Janet's website or call her office at (650) 469-8206.