November, 2019 | Shah & Associates, P.C. Estate Planning & Elder Law Blog
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New Jersey’s Intestate Succession Laws

November 18, 2019

Filed under: Estate Planning — Laura Pennington @ 3:39 pm

If you pass away without a will in New Jersey, your assets will be passed on to your closest relatives under laws established by New Jersey for intestate succession. Only assets that would have passed through your will are impacted by New Jersey’s intestate succession laws.

New Jersey Road Sign with dramatic clouds and sky.

Typically, this includes only assets that you own in your own name alone. It’s important to remember that many different valuable assets do not go through your will and are, therefore, not affected by intestate succession laws.

Common examples include life insurance proceeds, property that was transferred to a living trust, payable on death bank accounts, funds in an IRA, securities held in a transfer on death account, and property on hold in tenancy by the entirety or in joint tenancy.

If you pass away with children but no spouse, your children will inherit everything. If you pass away with a spouse but no descendants or parents, the spouse inherits everything. If you pass away with a spouse and descendants from you and that spouse but that spouse also has descendants from another relationship, your spouse is entitled to inherit 25% of your intestate property.

If you pass away with a spouse and parents, the spouse is entitled to the first 25% of your intestate property so long as this is not less than $50,000 and more than $200,000, plus three-quarters of the balance. The parents would inherit any of the remaining intestate property.

It can be overwhelming to try to figure out this process of deciding who gets what on your own. It’s important to schedule a consultation with a New Jersey intestate succession lawyer to put together an appropriate plan for passing on your assets.       

New Estate Tax Amounts Announced for 2020

November 12, 2019

Filed under: Estate Planning — Laura Pennington @ 2:13 pm

The IRS has authority on the estate tax and gift tax amounts that affect individuals and families and recently announced changes to the estate tax amount for 2020.

If your estate plan requires an update or if you’d like to adjust your giving strategy in 2020, now is the right time to speak with an estate planning lawyer about those options.

The official estate tax exemption has been increased to $11.58 million per person, an increase from the 2019 number of $11.4 million. This means that as a single person, you can leave up to $11.58 million in assets behind for your loved ones without triggering an estate or gift tax.

Couples, as usual, are able to take advantage of each person’s individual amount for a combined total os $23.16 million. The annual gift amount remains the same at $15,000.

When discussing your options with your estate planning lawyer, you might decide that you can use a combination of giving over your life to maximize the gift tax and giving at death with the raised estate tax amount.

With an upcoming presidential election, possible changes to the gift tax amount are front and center for many people. Depending on the outcome to that election and changes made to the program, if they occur, you’ll want to be prepared by having a dedicated estate planning lawyer who can help you figure out how to make it all work together.

Three Tips to Make Business Succession Planning a Breeze

November 11, 2019

Filed under: Estate Planning — Laura Pennington @ 3:46 pm

No entrepreneur wants to think about a future in which they are not involved in their business without that being their own choice. It’s smart to hope for the best and prepare for the worst but recent studies have shown that far too many entrepreneurs and business owners are hoping and preparing for the best instead.

Research from the National Association of Corporate Directors showed that two thirds of private and public companies had no formal succession plan in place for their CEOs. As a business owner you know that proper plans and structure have a key impact on your ability to thrive.

Since the future is unpredictable, the consequences of failing to institute a formal succession plan could end up harming your loved ones and your business. Three tips to make business succession planning easy include:

  • Don’t procrastinate and instead think carefully about other options if it falls on you to leave the company, such as disability or divorce.
  • Identify a successor for who can step in to provide continuity if you are no longer involved in the business.
  • Identify the current value of your business, preferably with an objective third party so that you know where you’re working from and the different stakeholders who might be involved if you were to step away from the company.          

Sitting down with the right attorney can make a big difference in how you approach and accomplish business succession planning.

Where Should I Keep My Will?

November 6, 2019

Filed under: Estate Planning — Laura Pennington @ 1:56 pm

If you already created your own will without the help of an attorney, it’s still a good idea to have a lawyer review your document to ensure it’s in line with state laws. While a DIY will might seem like the easier route to go, the costs associated with making a mistake on a DIY will can follow your loved ones for many years.

Having the peace of mind of speaking with an attorney gives you the chance to correct anything inside the will that could potentially render it invalid. Furthermore, you can discuss safe places to store your will document after it’s been fully executed.

Your original will should be stored in a safe and fireproof location. Most people assume that a safety deposit box is the best place to store critical documents, including your will and even funeral or memorial instructions. The problem with this approach is if none of your loved ones know where to find this information or if they can’t get to it in time for it to be useful.

More immediate documents like your desires concerning a funeral or instructions from the plans you’ve made in advance could be stored with your estate planning lawyer or a close family member or friend. Someone else should know where to locate this information should it become necessary.

Your original will should be stored in a safe location as mentioned above, but you can keep copies elsewhere. Signed copies of the will are important in the event that the original is destroyed. It’s your job to make sure that you’ve taken as many proactive steps as possible to make it easier for your loved ones if you suddenly pass away.

While it’s a difficult subject to approach, your foresight and planning can help your loved ones in a challenging time.

When to Begin Asset Protection Planning

November 5, 2019

Filed under: Estate Planning — Laura Pennington @ 1:38 pm

Are you concerned about your assets being exposed to risks? Worried that your personal assets could be tapped through a lawsuit or through a creditor looking to close on a debt?

The best time to begin asset protection planning is long before any of these threats is on the immediate horizon. Every state has laws that protect a judgment creditor making legal efforts to collect if the debtor tries to transfer assets out of their own names in an effort to delay or block a collection attempt.

Courts, therefore, can see right through these moves and would likely classify them as “fraudulent transfers.” With asset protection planning, you must be thinking about options to shield your assets well in advance of any filed suits.

Even waiting until you think that a lawsuit might be filed is too late in most cases. While there might be a few limited steps you can take at that stage, you’re much better off by making an effort to talk with your estate planning lawyer about asset protection planning now.

The purpose of taking these steps when there’s no immediate exposure to a suit is twofold: it helps discourage people who think that you might be an easy target for a lawsuit away from doing so because they recognize that your asset protection efforts will make it harder for them to succeed and it also increases your chances of success in the event a suit is filed.

Most people who put together an asset protection plan hope that they never need to exercise its powers in court. But the peace of mind that this provides can give you confidence going forward that if a potential threat emerges that you have options available to you.

If you’re ready to talk asset protection plan specifics, our office is here to help you craft a customized plan based on your needs. Don’t wait until it’s too late- create your plan today.

Own a Financial Firm? It’s Time to Start Succession Planning

November 4, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

Many financial advisors are soon to be aging out of their companies. The average age of today’s financial advisors in the United States is in the mid-50s and plenty of these professionals are moving into their 50s and 60s.

The future fates of these thousands of practices, however, hangs in the balance for those that have not completed succession planning. Studies show that the vast majority of small advisors, particularly those who are handling their firm on a solo basis have no successor or business succession plan set up.

According to recent research studies, solo practitioners who bring in around $250,000 per year in revenue often have no succession plan and the alarming fact that these represent up to 70% of the financial planning industry.

While bigger practices are more likely to have a business succession plan or even a strategy for training future leaders in the company, it is important to sit down with a dedicated business succession planning lawyer and estate planning lawyer to discuss how the future of your business and the future of your personal assets can be reflected together in a comprehensive estate plan.       

Your business succession plan is the roadmap for those still in the company to be able to continue operating even after you’re no longer there. Having a backup plan in case this happens can have a big impact on your company’s success.