As a team of reputable estate planning and wealth management lawyers servicing Reading, PA, residents, Kozloff Stoudt understands that there are lots of reasons why people decide to create an estate plan. Today, we’ll look at a few of the most valuable reasons.
A probate is a process of validating a deceased person’s will and assigning values to their assets, paying off their final bills and taxes, and distributing the remainder to their beneficiaries. Avoiding this undertaking is one of the most common reasons people seek out the counsel of an estate planning or wealth management attorney. With probate, there is a bevy of litigation fees for executors, advisors, and administrators. Estate planning titles property, so probate isn’t necessary to move ownership.
Reduce Estate Taxes
A substantial loss of one’s estate to the payment of government estate taxes or state inheritance taxes is another excellent motivator for people to put an estate plan together. Married couples can reduce or possibly even get rid of estate taxes altogether by setting up A-B Trusts as part of their wills or revocable living trusts. People with high net worth may also buy a life insurance policy to foot the bill after they’re deceased.
There are essentially two main reasons why someone would put together an estate plan in an effort to protect their beneficiaries: To protect those beneficiaries who are minors or to protect adult beneficiaries from poor decision-making, outside influence, creditors, and divorcing spouses.
If the beneficiary is a minor, every U.S. state has laws that require a guardian to be appointed to oversee their needs and finances until the minor becomes a legal adult. Depending on the state in which the minor lives, the adult age can be either 18 or 21. If the beneficiary is already an adult who is notoriously bad at managing money or has a spouse you fear will squander the beneficiary’s inheritance or take it in a divorce, you have the option to create an estate plan that will protect them.
Asset protection trusts are among the most effective tools that can shield someone’s wealth from lawsuits. Asset protection is a collection of strategies and legal tools used to protect one’s assets from lawsuits and creditors’ claims. A professional will review your assets, risks, and financial goals. Then, the planning process includes establishing structures like trusts and companies to create legal barriers between you and your creditors. These strategies can consist of business and estate planning tools.
If you require an estate planning or wealth management lawyer in Wyomissing, contact Kozloff Stoudt today!