Estate Planning

How is Your Estate Planning?

  • How much of your estate is earmarked for the IRS?
  • What strategies do you have in place to minimize estate taxes at death?
  • How thoroughly has your family discussed estate planning issues?
  • How would you like your estate handled and by whom?
  • When did you last review your will and how are your assets titled?
  • Do you have a favorite charity, school or group to whom you want to bequeath assets?
  • When was the last time you reviewed the beneficiary designations on your insurance programs and retirement plans?

Team Approach Required

Estate planning for the client should be done on a team approach. It requires a complete knowledge of accounting and asset valuation principles as well as several areas of the law including federal estate and gift taxation, state gift and inheritance taxes and state property and probate law. The estate planning team must include an attorney who specializes in estate, probate and tax law. Other team members should include appraisers and life underwriters depending on the rolls the accountant/Financial Advisor wants to fill.

Defining the Client's Taxable Estate

A good starting point in estate planning is to assess what would be estate taxable if the client (or the client and spouse) died tomorrow. The liability for the payment of the tax is imposed upon the executor. The taxable estate includes:

  • Assets titled in the decedent's name.
  • Retirement plan benefits
  • Life insurance (where client retained an incident of ownership or transferred the policy within three years).
  • Revocable transfers.
  • Transfers with a retained interest.
  • Joint tenancy property.
  • Community property (1/2).
  • Property subject to a General Power of Appointment.
  • Certain transfers of interests made within three years of death (mostly life insurance, gift taxes paid and General Powers of Appointment relinquished).

QTIP trust planning with the marital trust (A Trust)

Generation Skipping Planning

Correcting errors in estate planning - after death

Gifting Strategies

Using Trusts:

  • Clients of any net worth should have wills if they have children (to name guardians of the estate and guardians of the person for the children in the event of premature death).
  • Clients that desire privacy, have out of state property, live in high probate cost states, or have assets that may not be respected with, should consider a revocable living trust to hold all their assets.
  • Clients that have a business interest or farm may be eligible to defer payment of the estate tax or receive special estate tax valuation of their assets (through the use of the special use valuation allowance).

* The financial consultants at Wealthcare Financial or Academy Advisors do not offer tax or legal advice. Please consult with your qualified tax or legal advisor for your specific situation.