Most people associate legal wills with estate planning. Estate planning involves writing a will but it covers a much wider scope apart from will writing. Overly it can be said to be procedures that ensure your loved ones or heirs avoid probate, minimize taxes and that you come up with a living will in which you get to appoint trusted associates who assume executor status as well as power of attorney in case of death or incapacitation. Estate planning also guarantees you of direct management of your assets in the event that you die. The first priority of any estate planner is to ensure that only the least part of the estate goes to the taxman.
In the US and other countries, death usually attracts taxes which are specific in nature from the Federal and state governments like estate tax and death tax. Minimization of estate tax is best achieved by incorporating recipients of your assets in your will and specifying that a particular amount has been given as a gift. While at this, take care not to exceed the lifetime tax free gift limit of $1 million.
Estate planning Philadelphia demands that a living will be included in the estate plan. You should however note that a living will is not thought of as a legally binding document. Despite this, a living will is given priority in the case of incapacitation or inability to make decisions or carry out legal rights. You can go ahead and appoint someone to actually assume your EPA or enduring power of attorney. Your EPA is only challengeable by a court of law. The will forms the foundation of any estate plan. This is clearly exhibited in the case of death without a will. The state will be obligated to distribute your assets as per the set laws of the state according to probate. This will be followed by hefty taxation usually the maximum amount possible due to the fact that the assets have no clear status designation.
In such a case, the remaining spouse is only entitled to one third of the entire estate while the rest goes to the children. An estate plan takes care of among other issues that the inheritance bequeathed to a child goes expressly to him/her as opposed to the child's spouse. In the event that your child divorces, his or her inheritance is excluded from that settlement as it is not a shared asset of that union.
Estate planning also ensures that your property should it be of significant value is not shared up and sold. This is termed as prevention of asset division. This is done through the establishment of a family trust. Estate planning is an overly good idea as it guarantees your loved ones peace of mind once you are gone.
|
