Maybe you have made a will but have not taken the time to do any further estate planning. You may think that a will is enough to pass on your wishes and dispose of your estate. For many people, however, further estate planning is both useful and necessary.
No Estate Plan? Taxes Could Be High
The larger your taxable estate, the higher the estate taxes your estate may have to pay. If your estate value exceeds your available estate tax exemption ($11.18 million for U.S. citizens and permanent residents, and only $60,000 for non-citizen non-residents), then taxes are due.
Unfortunately, not doing any estate planning means you probably do not know if your estate will owe taxes. There are ways to reduce the taxable estate through planning that can allow you to leave more to relatives and less to the IRS. If you are a non-citizen and own real estate, have bought stocks, or keep significant cash assets, you should seriously consider doing more estate planning.
No Estate Plan? Probate Court Costs Await
In California, the cost of going to probate court depends on the size of your estate. The larger the estate, the more costly court oversight is. Also, your estate may need to pay the executor and attorney too.
Estate planning can help you reduce the size of your estate for probate court purposes. For example, property could be placed in trust. Usually, property in a trust does not count towards your probate estate. California probate court rules exclude some other items from the probate estate, such as life insurance policies and pensions. They are excluded as long as you give the policies to specific beneficiaries, not just to your estate.
Uncertainty About Your Final Wishes
In addition to practical tax and costs issues, not having an estate plan can lead to relatives’ uncertainty about your final wishes. They may not know whether you would want life support removed, or whether you would prefer a funeral or cremation. Relatives may have conflicts about dividing up estate property, such as sentimental heirlooms and valuable jewelry. Working on your estate plan and signing the necessary documents can help resolve uncertainty. You can have peace of mind for the future.
Planning your estate? 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.