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Why an Estate Plan Needs a Lifetime Approach

March 2, 2017

Filed under: Estate Planning for Children — Neel Shah @ 9:15 am

The right estate plan is a group of small plans that all work together in order to create a comprehensive plan for your business, your family and your life depending on your unique situation. Don’t make the mistake of putting off your estate planning until it’s too late, as it could create additional confusion or frustration for your loved ones.

An attorney is an essential part of your estate planning process. The right lawyer will help you craft a plan for where you’re at now so that it can also evolve over the course of your life as needs change.

There are two primary components of your main plan; a death plan or estate plan including your trust documents and your will and other relevant materials. Many people who think of the term estate planning are referring to this portion. However, it’s equally important to have a lifetime plan as well.

Your trust or will may not be able to accomplish your lifetime goals as successfully without other components. Controlling your wealth and maintaining your lifestyle is important for any different situation. You may also be concerned, if you are married, about maintaining your spouse’s lifestyle in the event that you pass away. There are many different tools for doing this such as retirement plans, irrevocable life insurance trusts, and other strategies. You may also wish to make gifts to charity as well and to plan ahead carefully for any wealth that will be inherited by your family.

Ready to talk about putting together an estate plan or revising an existing one? Make sure you have outside counsel. With changing laws and individual needs, an attorney can help you navigate this process successfully.

 

Using a Trust with Special Purpose Language in Order to Protect Your Beneficiaries from Themselves

February 22, 2017

Filed under: Estate Planning for Children — Neel Shah @ 9:15 am

There are many different situations in which you may want to put together a trust that helps to protect your beneficiaries from hurting themselves in the future. Some examples include children who are struggling with addiction, those who are spendthrifts and individuals suffering from mental illness.

 

As a parent, there’s no doubt that you have concerns about their care and the most appropriate way to leave behind assets to assist with that care. However, estate planning might differ in this situation when compared with other types of families. Using a trust with special purpose language is frequently the answer.

 

Traditional estate planning goals can be accomplished with a trust such as minimizing taxes, ensuring that the intended beneficiaries are named and avoiding probate However, it can also be tailored for more unique family situations involving addiction or illness.
Parents can now add language that allows the appointed trustee to deal with the bad as well as the good, thereby incentivizing a child to meet certain requirements in order to receive a distribution from the trust. For example, you might outline that staying on a certain medication that helps the child control their addiction is necessary. proper planning should also include conversations about a HIPAA release and healthcare power of attorney after the child reaches age 18. Consulting with a knowledgeable New Jersey estate planning lawyer is strongly recommended.  

Tips for Protecting Your Parents Assets from Taxes

November 29, 2016

Filed under: Estate Planning for Children — Neel Shah @ 9:15 am

It can be overwhelming and frustrating to deal with the grief process while also figuring out how to handle your parents’ estate. Thankfully there are numerous steps you can take in advance to help to maximize the money passed on to beneficiaries and minimize taxes. There are multiple different tax saving strategies that can help your older parents save money and limit the amount of taxes that are owed by their estate after they pass away.

Some of these are steps that you can take while others are steps that your parents should take with the help of an experienced financial professional. These include:

  • Selling stocks that have losses.
  • Managing IRA strategically to reduce taxes.
  • Keep stocks that have regular gains.
  • File for a disabled or elderly tax credit, if eligible to do so.
  • Claim parents as your own dependents in the event that they qualify.
  • Put money into trusts, which can help with significant assets.
  • Gift money to beneficiaries while your parents are still alive.

Ready to talk options? Set up a meeting with our NJ estate planning office today.                                                                                                                  

A Customized Estate Plan Should Always be Handled by a Lawyer

October 25, 2016

Filed under: Estate Planning for Children — Neel Shah @ 9:15 am

If you are thinking ahead about your estate planning goals, it’s tempting to address your needs by filling out a form you found online.

A template will or other documents are not always legally binding and they may be a very poor fit for anyone who has special concerns or needs. In the event that your will is unclear or not in line with relevant state laws, your estate could become more complicated than you intended.

Here are some common situations that warrant the insight of an experienced lawyer:

  • Caring for a child with special needs
  • Wanting to give particular pieces of property to one beneficiary or another
  • Wanting to exclude someone from your will or other estate matters
  • Wanting to ensure that property is passed on with some element of control (such as through a trust)
  • Getting remarried or divorced and needing to update your plan or adjust to include past beneficiaries
  • Advanced planning strategies to assist with your estate or tax needs

As you can see, there are numerous situations that make it a good choice to set up a meeting with an experienced estate planning lawyer. Talking to a lawyer will help you identify the right strategies for you and your family now and well into the future.

Five Reasons to Do Estate Planning Now

May 17, 2016

Filed under: Estate Planning,Estate Planning for Children — Neel Shah @ 9:15 am

While there are numerous reasons that you should consider protecting your estate, there are five primary reasons that you should communicate with an estate planning attorney today.estate planning NJ

Protect Beneficiaries

An estate plan can be used to protect both adult and minor beneficiaries from negative outside influences, creditor issues, and bad decisions. It is particularly important to remember to appoint a guardian if you are listing a child as a beneficiary. Using an estate plan helps you defray legal expenses and avoid personal arguments between family members.

Avoid Probate

One of the most common reasons for engaging in the estate planning process is to avoid probate. Although many people don’t have a great deal of actual experience in dealing with a probate process, they understand the benefits of avoiding it. Using an estate plan helps you not only avoid probate, but several other common mistakes and pitfalls associated with estate planning.

Avoid Messy Confrontation

An attorney’s insight can help you tremendously throughout the estate planning process. Separate beneficiaries, family members, and business partners can often spend a large amount of time arguing over assets and possessions if the appropriate documents have not been put together beforehand.

Lower Estate Taxes

Many individuals are realizing the potential influence of state and federal estate taxes on the wealth they have worked so hard to build. Some basic estate planning, however, can help you protect these assets for future generations and also minimize the impact of estate taxes.

Avoid Unforeseen Creditor Predators

Asset protection planning is another important component of estate planning. It is too late to consider entering the asset protection planning process once a creditor has already emerged to threaten your personal asset. Instead, you need to conduct this well in advance by using strategies and tools recommended by an experienced New Jersey estate planning attorney. Contact an attorney to learn more about how asset protection strategies can help you now and in the long run. Reach out to info@lawesq.net for more information.

 

Estate Planning Parent Fears: Passing On Assets Without Spoiling Children

February 25, 2015

Filed under: Estate Planning,Estate Planning for Children — Neel Shah @ 3:53 pm

This is an issue that many of our clients express during their first meetings with us. Parents with wealth are concerned about leaving just enough to their children to allow the children to succeed without leaving too much so that the heirs would become “spoiled”.

When it comes to setting children up for success without making them too spoiled, parents can do a lot to install traits and virtues that promote behavior the opposite of spoiled. These virtues include generosity, thriftiness, patience, curiosity, perspective, and perseverance. How can parents promote this from birth? According to financial columnist Ron Lieber, who developed this list, parents can select balanced vacation options, reduce materialism on a daily basis, provide allowances that are not based on chores, and have clear conversations about money with children from an early age. shutterstock_113853856

It’s not just about selecting the right estate planning tools, but determining what tools will work in combination with the example set forth for children. The first stage of doing this involves putting in the time and the effort to think about this fear of having spoiled children and what can be done to avoid it. The second stage is in developing clear statements about goals and values for the children. Once you have accomplished this, it’s time to put together an action plan that lays out how these goals can be achieved.

Working together with establishing goals and confronting fears, estate planning can be an empowering process that puts parents in the right perspective to think about their legacy.

Contact us today to learn how we can help you info@lawesq.net.

 

Estate Planning Tips: A 529 Savings Plan

October 20, 2014

Filed under: College Planning,Estate Planning,Estate Planning for Children — Tags: — Neel Shah @ 9:34 pm

If you’ve already looked into getting one, you know that Section 529 savings plans are able to accumulate earnings without federal income tax (and in many cases, state income tax). Once the beneficiary of the account reaches the age where he or she is going to college, that individual can take out withdrawals tax-free to pay for college expenses.

For the most part, relatives set up 529 plans, but no family relationship is actually required. Another little-known fact about these is that most of them will accept larger lump sum payments. Making these larger payments into a 529 plan can be beneficial for your estate planning because they are treated by the IRS as “completed gifts”. Likewise, they also fit into the yearly gift tax exclusion ($14,000). If you decided to spread your lump sum over several years, you could benefit from this gift tax exclusion every single year that you’re making a contribution.2014-10-20_1436

This is a great tool for grandparents who want to help support their grandchildren’s future, because you can be making contributions for numerous grandchildren over several years. As an added bonus, 529 accounts can be a bit flexible, like if you need to change account beneficiaries without facing any penalties. Contact our offices today to learn more about estate planning tools and options to minimize taxes and pass on your legacy. Call us at 732-5521-9455.

Back To School Tips: Important Documents for Parents of New College Students

August 22, 2014

Filed under: Estate Planning,Estate Planning for Children,Planning for Minors,Power of Attorney — Tags: — Neel Shah @ 5:41 pm

There’s no doubt that your mind is already pretty preoccupied with many different lists of supplies, last-minute shopping, and packing with your new college student. But it’s critical that you think about whether getting your adult child’s signature on two key estate planning documents is a good step. These two documents are a health care proxy and durable power of attorney.

So why, in the midst of everything else, should you be concerned with estate planning? In the majority of states, parent will not have the authority to determine health care decisions for children once those children have turned 18. This is true even if the parents are paying tuition or claiming those individuals as dependents on their tax returns. If the child were involved in an accident, for example, or became disabled, a parent might have to get court approval in order to act on behalf of his or her child.

Having both of the above-mentioned documents in place before your child goes off to college can give you a sense of peace and confidence that you will be able to act on behalf of your child in a worst-case scenario. Consider adding these crucial documents to your safebox at home today. In the event of an emergency, you can focus on caring for your child. Contact us today at 732-521-9455 or info@lawesq.net.

Back To School Tips: Important Documents for Parents of New College Students

 

 

 

 

 

 

 

 

 

Photo Credit: campaigner.com

Estate Planning Tips for the Blended Family

July 22, 2014

Filed under: Blended Families,Divorce,Estate Planning,Estate Planning for Children — Tags: , , , — Neel Shah @ 4:58 pm

Second or third marriages can be very fulfilling, but they also bring their own set of challenges when it comes to estate planning. There could be children from previous relationships and children that have been born into the new marriage. If both parties were previously divorced, this can complicate property and other assets that have been brought into the marriage.

Estate Planning Tips for the Blended Family
(Photo Credit: revealedintime.blogspot.com)

You want to approach this issue by thinking about your individual estate planning goals first. Your assets, like investments, retirement plans, brokerage accounts, jewelry, cars, and houses, should all be considered. If you have not recently updated your beneficiary designations, you will want to consider whether your goals have changed as a result of a new marriage. Frequently people forget to update the beneficiaries on these important accounts after getting remarried, so it’s important to schedule an annual review with your estate planning specialist so that your documents always reflect your most current goals.

If there are certain items that you want your children to receive, make sure that you clearly note these items in your estate planning documents. Leaving all of the property to the surviving spouse may not be the best approach because it doesn’t ensure that those children will actually receive those benefits. In many cases, it’s most appropriate to use trusts to provide for the spouse while making separate plans for the children to receive the property. To learn more about our special planning for blended families, reach out to us through email at info@lawesq.net or contact us via phone at 732-521-9455.

Married Couples without Children: Estate Planning Recommendations

May 21, 2014

Filed under: Estate Planning,Estate Planning for Children — Tags: , , , — Neel Shah @ 1:01 pm

Your individual estate plan is going to depend largely on your personal situation and the goals you have for your assets. That being said, one major factor that can alter your estate planning situation tremendously is children. Without children, some couples might wonder what estate planning options could be used.

Married Couples without Children Estate Planning Recommendations
(Photo Credit: lancewoodley.com)

One such example is a QTIP trust, or a Qualified Terminable Interest Property Trust. This trust gives a benefit to the surviving spouse that keeps the assets out of the hands of creditors. Using this trust properly, assets from the trust that are still present after the surviving spouse passes away would then be given to beneficiaries stipulated by the spouse who passed away first.

A big benefit to this approach is that the personal representative of the first spouse (referring to the spouse who passes away first) can exert some flexibility over the best way to proceed. A partial QTIP election or portability election are the choices that a personal representative might consider after the first spouse passes away. One factor to bear in mind is ensuring that the applicable exclusion amount of the first spouse doesn’t go to waste, which can be addressed in planning strategies with your estate planning specialist.

Your family structure and how involved your family is in your own estate plans strongly dictates what needs you have when you come to the table to discuss your goals and concerns. To learn more, email us at info@lawesq.net or contact us via phone at 732-521-9455.

For the Furry Ones in Your Life: Estate Planning With Pets in Mind

April 25, 2014

Filed under: Estate Planning,Estate Planning for Attorney,Estate Planning For Business Owners,Estate Planning for Children — Tags: , , , , — Neel Shah @ 8:10 am

Although many people have heard about the traditional aspects of estate planning, like a will, it’s all too often forgotten that you may have others you need to include in your plans. The majority of houses across the country have pets inside, and it’s worth considering what you’d like to happen to your animals if something happens to you. Pets are treated as personal property, so it’s crucial that you do a little research about where you’d like them to go.

For the Furry Ones in Your Life Estate Planning With Pets in Mind
(Photo Credit: the-hunting-dog.com)

A pet trust, for example, can outline the type of care your animals will receive after you pass away. With a funded pet trust, you can rest assured that your animals will be taken care of no matter what. This trend is expanding in use across the estate planning industry. A first step in your pet plan is to write a description of all animals, including any distinguishing characteristics. This helps to avoid copycat pets or mistakes receiving care that you intended for your own animals. Microchip numbers, too, should be included for identity verification.

You can work with an estate planning professional to determine the cost of care for your animal. Factor in vet care, routine medications, any special supplements, pet insurance, and food, multiplied by the life expectancy of your pet. Talking this over with any family members can be helpful for establishing those who may want to care for your animals, too. Have questions about pet trusts or other planning tools? Send us an email at info@lawesq.net or contact us via phone at 732-521-9455.

Estate Planning and Reproductive Technology

April 24, 2014

Filed under: Estate Planning,Estate Planning for Attorney,Estate Planning For Business Owners,Estate Planning for Children — Tags: , , , — Neel Shah @ 11:33 am

Unfortunately, estate planning law hasn’t really stayed on pace with reproductive technology and rights, generating quandaries about inheritance rights. It would make sense that children conceived after the death of an individual (or statements denying inheritance rights about these individuals) should be included in estate planning documents.

forbes.com
(Photo credit: forbes.com)

A trust might be a more appropriate vehicle for managing inheritance rights in this way when compared with a will. A comprehensive estate plan, too, can also be valuable with regard to genetic material. Much the law with regard to inheritance rights and genetic material is very specific to each state, which is why it’s recommended to work with a professional if you’re concerned about children conceived posthumously. In many states, the law has not provided a framework for the disposition of embryos or gametes at the death of the donor.

While not every estate plan will include such instructions and details, it’s critical that those in this situation think about whether those individuals conceived later will have any inheritance rights. Planning in advance for this and documenting your wishes is a vital step in ensuring that your wishes are carried out after you have passed away. Advance planning can be complex, but the process is made easier when working with an experienced estate planning lawyer. To learn more about complex estate planning needs involving reproductive issues, contact us at 732-521-9455 or email us at info@lawesq.net

529 Plans Benefit Grandparents and Grandchildren

October 30, 2013

Filed under: Estate Planning,Estate Planning for Children,Planning for Minors — Neel Shah @ 9:00 am

As a recent article explains, a majority of wealthier investors prefer to transfer money to their grandchildren through 529 college savings plans. In part, 529 college savings plans are popular because they allow the grandparents to reduce the value of their taxable estate, while also maintaining control of the funds removed from the estate.

A person can open a 529 College Savings Plan for each of his or her grandchildren. The grandparents can then transfer up to the current annual gift tax exemption amount to each account, tax-free. Not only will the 529 account grow tax-free, but any withdrawals made by the grandchildren will be tax-free, as well.

English: A grandfather teaching his little gra...

(Photo credit: Wikipedia)

Importantly, the donors to the account are the ones who determine how the assets will be distributed. For example, if a grandparent unexpectedly has a stay in an emergency room and requires the money, he or she can take the assets back. If this happens, however, any investment gains would be taxed to the grandparents when the assets are withdrawn. This penalty tax, however, is only ten percent. Many donors attempt to “frontload” the 529 account so that they can make a lump sum gift of $65,000, tax free.

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Thanks Gramps! Planning Gifts to Grandchildren

October 29, 2013

Filed under: Beneficiaries,Estate Planning,Estate Planning for Children,Planning for Minors — Neel Shah @ 9:00 am

Often, grandparents who have extra money wish to assist their grandchildren financially. A recent article discusses three ways through which grandparents can give to their grandchildren.

Grandparents with a child

Grandparents with a child (Photo credit: Nestlé)

Write a Check

Many grandparents simply write checks to their grandchildren without thinking twice about it. Under current tax rules, a person can give as much as $14,000 per recipient per year, without tax consequences. If you would like to give an individual grandchild more than $14,000, consider using another vehicle to avoid tax consequences. Finally, remember that this type of gift is often calculated into a giver’s estate for the calculation of whether a person is eligible for means-tested government programs such as Medicaid.

Invest in a College Savings Plan

If you want to assist your children with paying for a college education, consider a 529 account rather than simply writing a check. With a 529, you can be certain that the money is spent exactly how you would like it to be spent. Additionally, 529 accounts offer important tax benefits that will not have any impact on your grandchild’s ability to apply for means-tested financial aid.

Use a Gift Trust

Finally, you can transfer money to your grandchild through a gift trust. A gift trust is an account that you set up where you or a named individual serves as the trustee. The trustee can direct the timing and use of any distributions made from the trust.

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Planning With a Baby on Board

October 3, 2013

Filed under: Beneficiaries,Estate Planning for Children,Guardianship,Planning for Minors,Trusts,Wills — Neel Shah @ 1:19 pm

The birth or adoption of a new child is a frenzied and joyous time in the parents’ lives. Understandably, estate planning is often the last thing on the minds of expectant parents. However, as a recent article explains, certain parts of estate planning are essential for a growing family. Expectant parents should consider at least the following two questions, and plan accordingly before it is too late.

Children, Baby new born

Children, Baby new born (Photo credit: Wikipedia)

Who Would You Trust to Care For Your Children?

Should the unthinkable happen and neither you nor your partner are able to care for your children, it is important that you have a plan in place. If you do not designate a guardian for your children, or the guardian you have designated declines to serve, the court will select the person who will care for your children. This may or may not be the person that you would have chosen.

Do You Have Life Insurance?

Life insurance is an important part of the estate of many parents. Life insurance provides a guaranteed sum of money that can finance the care of your spouse and children. For extra protection, you can designate that if you and your spouse pass on before your children reach the age of majority, the money will be kept in trust and distributed only by a designated trustee. You can further designate that, should you die after your children reach the age of majority, they can simply receive the sum outright or in installments at various ages such as 21, 25, and 30.  Yet another popular option is to allow the money to stay in trust forever to maximize asset protection, while ensuring financial needs are met.

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Are the Kids Alright? – Your Children Need an Independent Estate Plan

August 15, 2013

Filed under: Estate Planning,Estate Planning for Children,HIPAA — Neel Shah @ 6:55 pm

Middle-aged Americans are constantly reminded that they need to create estate plans in order to protect their family from the unexpected. As a recent article explains, however, it is just as important for your adult children to create an estate plan as well, even if it’s a simple one.

Once your child turns 18, you lose any authority you had to view his or her medical records or make decisions about his or her medical treatment. The only way to avoid this is to encourage your child to participate in some simple estate planning maneuvers.

The Cool Kids

(Photo credit: TheMarque)

This planning is especially important as your child heads off to college. If your child suffers a major accident and is left unable to communicate, you would have to go through the daunting process of petitioning a court to appoint you the legal guardian of your child before you could make any medical decisions for him or her.

For less serious medical incidents, the Health Information Portability and Accountability Act (“HIPAA”) makes it difficult, or sometimes impossible, for a parent to receive critical medical information, including whether or not your child was admitted to a hospital, and to which one. If you and your child wish to avoid this, ask your adult child to complete a health care proxy and HIPAA release, which allows you to receive medical information concerning your child and to make medical decisions should he or she become incapacitated.

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