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New Study Reveals Estate Planning Concerns of Cryptocurrency Owners

Are you an owner of cryptocurrency? A recent study might reflect some of the feelings that you have about your investment in your funds. According to the company Coin Cover, up to 90% of cryptocurrency investors are concerned about their funds if they pass away but plenty of them have ignored the opportunity to put together an estate planning strategy.

Fewer than 25% of the same study participants indicated that they were involved in a comprehensive plan for their digital asset. Cryptocurrency is not the only type of digital asset that you might have under your name. It is important to take necessary planning steps and precautions in order to protect your interests and ensure that you have considered all aspects of your digital accounts and ownership.

Owning cryptocurrency or any form of digital asset requires you to think about how it fits into your bigger picture and whether or not you have the right estate planning strategies for it. Although things like this might seem like newer forms of assets that can easily be overlooked, they might represent substantial ownership benefits for your heirs if you plan the right way. Since there are so many specifics to this form of currency and other digital assets, make sure you have a yearly meeting set aside with your financial professional and your estate planning attorney to ensure your plans are all up to date.

Schedule a consultation with a trusted estate planning attorney to learn more about how to prepare an estate plan with digital assets such as cryptocurrency in mind.

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Should I Transfer My New Jersey Home to My Child Now?

If you own an entire property in New Jersey or a portion of a property in New Jersey but live outside the state, there are several important things you need to recognize about the process of passing this on to someone else. First of all, New Jersey does not have a state gift tax.

At the federal level in 2020, however, there is an annual federal gift tax exclusion of $15,000, meaning that any gifts extending beyond that amount require you to file a gift tax return for the portion above $15,000. It’s also important to recognize your overall lifetime estate tax exemption which is $11.58 million for individuals in 2020. No gift tax would be incurred as long as you do not intend to make gifts greater than that amount.

Although it seems like with little tax implications there is good reason to make this gift during the course of your life, the purchaser’s cost will carry over to the recipient of a gift, meaning that your child could inherit the property with a cost basis equal to whatever you paid for that share of the property or the property itself. If the property has increased in value significantly since you purchased it, this means that you could be subjecting your child inadvertently to a large capital gain tax.

Some other states, such as Pennsylvania will have a reciprocal income tax agreement with New Jersey but this does not extend to income that goes beyond compensation. For more information about some of the challenges associated with passing on property, schedule a consultation with a trusted New Jersey lawyer today.

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Estate Planning for An Adult with a Disability

Planning for an estate is important for everyone, but especially if you are the caretaker of an adult with disabilities, it’s important to ensure all the documents are lined up to protect this person. The guidance of guardianship estate planning statutes can enable a court-appointed guardian of a disabled adult to put together estate plans for those adults based on a petition to the court. Across the U.S., there are thirty-two states with provisions on the books that enable estate planning to be formally handled by a guardian on behalf of a disabled party.

While these 32 states do have laws on the books about these issues, those statutes usually fall into two general categories. For the first set of states, statutes allow guardians to have broad power over estate planning issues on behalf of a disabled adult.This can include carrying out trusts, codicils, and wills. Only a handful of these states, however, allow the guardian to actually make the will on behalf of the disabled party.

The second grouping of states include those that have either left out of the power to make the will in an implied or expressed manner. This means that the ability to make a will is either not mentioned or has been expressly prohibited as something that a guardian can do on behalf of any adult with a disability.

Estate planning is not always a power that an appointed guardian can do for a disabled adult. This includes creating a will but also incorporates other kinds of estate planning powers.

If you are interested in being appointed as a guardian for an adult in your family who lives with disabilities, it’s important to sit down with a trusted estate planning attorney to discuss your options. Knowing exactly what you can and cannot do when appointed in this role will give you some clarity and allow you to accomplish what is needed on behalf of an adult with a disability. Need more help? Our NJ estate planning law office is here to help you.

 

 

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The Financial Outlook for Workers has Changed

As a result of Covid-19, many people are thinking about estate planning and financial planning in a whole new different way. Having difficult conversations about end of life and long term care plans has become top of mind for many families who might have had to confront these issues directly.

Even if you’ve maintained your health and your family during this crisis, it’s a good opportunity to step back and plan for your own future. Incapacity planning and updating your estate should be some of your biggest priorities.

Having a loved one diagnosed with Covid-19 or having to prepare loved ones for who is responsible for making medical decisions in the event that you become incapacitated has become a common thread for communication throughout many different families. Many people are also exploring new financial opportunities including side jobs as a result of the uncertainty and significantly changing job market brought about by the pandemic.

A recent survey completed with nearly 2,000 Americans found that 41% of respondents saw a reduction in their work hours that impacted their income, nearly 17% were furloughed and just over 28% had lost their jobs.

The study looked at the many ways in which those people have attempted to pivot or respond, including deferring or adjusting essential payments, tapping into savings, taking out a loan or getting a side job. Now is a good opportunity to schedule a consultation with an experienced estate planning attorney to learn more about protecting your interests.

 

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Do You Think You Are Not Rich Enough to Consider the Benefits of Estate Planning?

The federal exemption for estate taxes in the United States is very generous, to the point that many people assume that they do not have enough assets to be worried about estate planning. In 2020, that threshold is $11.58 million per individual. You might think that estate planning therefore only applies to the extremely wealthy.

However, there are three reasons why thinking this way is problematic and why you might want to reconsider your frame of reference in deciding to move forward. First of all, you could become wealthier, particularly if most of your current wealth is in stocks. The government could also update the rules and limits for estate tax exemptions in coming years, and finally, some states have an inheritance tax.

This is particularly important for you if you currently live in a state that does not have and inheritance tax but are thinking about retiring in a state that does.

Regardless of where you’re at in your life, you need the benefit of estate planning to help you accomplish your goals and protect those you care about. Putting together an incapacity planning plan can help you get the peace of mind that if something happens to you and you become unable to speak for yourself that there’s a plan in place to ensure you get the care and support you need.

Schedule a consultation with a knowledgeable estate planning lawyer to walk through your options and make sure you’ve thought about estate planning the right way. Our office is here to help you review an existing estate plan or to create new documents and strategies.

 

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Estate Planning Matters for Your Small Business

Small business owners have plenty of things to think about in the wake of a worldwide pandemic that has shaken many things up. But that doesn’t mean you can afford to neglect the importance of proper estate planning or business planning options. Using this time to take a step back and reorient where you want the company to go in the near future is a good way to keep on top of these important tasks and ensure that if something happens to you, there’s a plan in place.

Every business owner has the long term vision and goal that their company is a big success, but it can take a lot of work to get there and even more work to sustain it after the fact. When you need to make a departure from the company, you need to know that you have a succession plan that will serve your needs and give your business the sustainability it needs.

That comes down to systems, a succession plan, and the right people. All of these elements should be in place well before anything happens involving you or another company owner needing to make an exit. One primary reason to engage in business succession planning beyond these basics is that if you’re in a partnership, you can ensure maximum options for the remaining partner should something happen to the other one.

Buy-sell agreements can help to accomplish this task because it ensures that unless intended, the family members of the deceased party are not the ones who get access to the company value. If there’s no buy-sell agreement in place, the business could be tied up in the estate administration if one of the partners of the company passes away. Most buy-sell arrangements for small businesses will automatically allow other owners to purchase the owner’s share in the company, allowing for a smooth transition to what the business looks like in this new iteration.

Are you stuck on how to make the most out of small business estate planning? Now is a good time to discuss all your options with a dedicated business succession planning attorney in NJ. Set up your meeting today.

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Revisiting Your Estate in the Wake of a Divorce

Going through a divorce is difficult and it shakes up your family structure and even your day-to-day life in a big way. There are also so many legal issues that have to be handled to dissolve the marriage and allow you to move on with your own life, such as moving into a new place to live or updating your last name if you had previously taken the last name of your spouse.

 

Some marriages might end quietly, leaving you to think that you have handled all of the most important issues from a legal perspective and are able to move on successfully into your new life. However, you need to think carefully about the importance of planning and updating your estate following the divorce.

Without a spouse through whom you can anchor your estate plan, guardians, executors, trustees and agents under health care proxies and power of attorney must be reconsidered and formally updated in your documentation. These are not the only type of documents that need to be evaluated and carefully handled in the wake of a divorce. This is because separate documentation under beneficiary forms take priority outside of any wishes you make in your estate plan.

For example, beneficiary forms associated with your life insurance policy or retirement plans must be updated to reflect the dissolution of the marriage, otherwise these are legally binding and you most likely have your spouse listed as the recipient of these accounts. Make sure that you review your marriage dissolution documents to determine some of the steps you need to take. Provisions inside these agreements might call for the removal of spouses from one another’s estate planning documents and retirement accounts but it falls to you to make sure that this is carried through.

 

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Is Trust Administration Different from Probate?

When planning ahead for the future of your estate, trust administration and probate administration are not one and the same. There are some key differences between administering a trust estate and administering an estate inside probate.

The most important difference, for example, is that trust administration is private. For trust administration to begin, a notice letter should be sent to decedent’s beneficiaries and heirs informing them that the trust is being administered. Probate, however, is supervised by the court.

During probate, any of the documents related to the will become subject to public record. This means that details of the estate could be accessed by any member of the public who requests them. Probate will also apply if there is no will and the same rules of public record apply. In terms of trust administration, however, only the trustee and the heirs are able to see the details of the trust.

Another difference between these two processes is that the expenses are different. With probate, you need to submit a court filing fee and any fee associated with publicizing the estate in the newspaper. Any personal representative fees would also be covered under the overall value of the estate’s assets.

For trust administration, the trustee is still entitled to reasonably pay for his or her services, but there are no court filing fees. Unless there is a contest over the trust itself, there’s unlikely to be too many other costs associated with administration or dispute.

Depending on your individual goals, you might need both a trust and a will.

Do you have questions about using both a trust and a will for your estate planning in New Jersey? Our law office is still here working with clients actively and helping them determine their next steps. Schedule a consultation with our law firm today so that you can learn more about what to do next.

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What Is a Psychiatric Advanced Directive?

Much like a health care power of attorney or a medical advanced directive, a psychiatric advanced directive is a legal document that is completed to provide instructions regarding the services or treatment that a person wants to have or wants to refuse to have during a mental health crisis.

These choices could significantly influence the type of psychiatric care available to the patient but this becomes very important when a mental health crisis emerges and the patient is no longer able to speak up for themselves.

Anyone who is potentially hospitalized for a mental health condition could become too sick to stay in charge of their treatment and make informed decisions about what they do and don’t want. During these times, doctors and other medical professionals will turn to advanced directives to help get inside about specific wishes that the patient made in advance of this particular health crisis. 

This document can be used to spell out your individual wishes about what type of services, assistance, and treatments you want to have access to when you are sick or those that you do not want used for your treatment if you are no longer able to make decisions in your care. 

This directive provides a clear statement about your instructions and your medical treatment preferences and can also be used to grant legal decision-making authority to another person who serves as your health care agent and advocate until the mental health crisis is over. For more information about how to use advanced directives and other tools and documents to help you plan ahead, schedule a consultation with an estate planning attorney today.     

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A Post-65 Estate Planning Primer

Estate planning is not just for the elderly. It’s not even just for those who see retirement on the horizon. Estate planning makes sense for people of all ages, but it does become especially important the closer you get to age 65.

There are several important things you should be thinking about as you approach and pass the age of 65. This has long been heralded as the primary age for retirement although many people are continuing to work past these years and looking to generate additional assets or simply because they enjoy the experience of working. There are legal risks associated with aging that you should take into account prior to reaching age 65 but this milestone is important for thinking about some of the other dangers that you might face as you continue to age. 

Increasing longevity numbers mean that anyone who has already reached age 65 should be thinking about the possibility of living for several decades longer. From concerns about paying for long term care to protecting your assets, planning to avoid guardianship, and qualifying for Medicaid, you might need an elder law attorney to help you identify all of the potential risks and to craft a strategic plan around protecting yourself from these risks and dangers. Schedule a consultation with an attorney who has extensive experience in the realm of elder law planning.     

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New Study Holds Promise for Seniors in Long Term Care

A recent research study from Simon Fraser University has important implications for one of the most common injuries that happen inside nursing homes: falls. Slip and fall injuries can be catastrophic for the elderly and are some of the most commonly reported injuries that happen in nursing homes across the country.

Falls in fact cause more than 95% of hip fractures in older adults and recovery can be very challenging or impossible. This most recent study was published in the Journal of Bone and Mineral Research and involved researchers looking at more than 2,300 falls experienced by over 600 residents. Only 30 of those total falls led to hip fracture. While that number seems relatively low, the average resident in a long-term care facility falls up to three times per year and the cumulative impact of those injuries can be significant. 

If you are researching nursing homes and long-term care options for an elderly loved one, make sure that you have considered plans for incapacity and the medical care wishes of the resident. Putting these statements into existing estate planning documents can ensure that your loved one has the necessary care he or she needs when they need it most.   

Choosing a nursing home is a difficult prospect, but it’s also one that should prompt you and your loved ones to talk through care options and decide what you really need to do when protecting your loved one. Speaking with an experienced lawyer can help you and your family members get on the same page about next steps. Contact our office today to get support working through these challenges.     

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What 0.6% Interest Rates Mean for Your Estate Planning

 When interest rates adjust, you need to have in the back of your mind that it might be time to sit down and look at your retirement accounts and also your estate plans. As circumstances in the market and broader world are updated and adapt, you need to ensure your plan is in line with being updated, too.

Interest rates have hit historic lows across June and July 2020, meaning that there is some opportunity to discuss with your financial and estate planning professionals how to address this. 

One of the most important things to keep in mind is a grantor retained annuity trust which is an excellent way to ensure that most or all of the income from a property that is quickly appreciating and has high yields can be transferred to a child or another person with minimal impacts from estate or gift tax. 

When the retention period on a GRAT ends, assets inside the trust go to the named beneficiary known as the remainder. Any income or appreciation on the assets in excess of that retained annuity will pass on to your remainder beneficiaries tax free. GRATs can be especially complicated to put together but can accomplish a great deal of your estate planning and overall financial planning goals. 

To sit down and discuss whether or not a GRAT is appropriate for your situation, schedule a consultation with an estate planning attorney who can help you look at the inventory of all of your assets, your current estate planning strategies and tactics and how these can be updated or improved to reflect all of your needs.       

Our office is here to help you when changes in the market call for a change in your estate plan. Set up a time to speak with our estate planning lawyer today.

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Update Your Planning If a Divorce Is on the Horizon

Have you recently filed for divorce or are you in the midst of the proceedings to legally end your marriage? It’s easy to feel like there are plenty of details to think about, but chief among them should be what happens to your existing estate plans. During the divorce is a good time to evaluate any joint accounts, policies, or paperwork that gives your soon-to-be former spouse any level of decision-making power over your future. 

Most people forget in the process of handling all of the paperwork and the life changes that come with a divorce, to update their estate plans accordingly. In fact, it could be weeks or months before you update this necessary paperwork and if something were to happen in between, there’s a good chance that your former spouse is still listed as the person eligible to receive assets or to make decisions on your behalf if you become unable to do so. 

There’s no doubt that this should be a top of mind priority as you approach getting closer to your divorce date. Many attorneys have reported that their office has been busier than usual with contacting questions about updating estate planning documents or getting estate planning done for the first time at all. 

These documents are not static and should remain living and breathing documents that should change just as often as your life does. Health care directives, powers of attorney and beneficiary forms are just a few examples of the documents that should be updated after you get divorced. To ensure that all necessary paperwork is updated with your new life, schedule a consultation with an estate planning attorney to walk through a checklist of what you can anticipate.       

Our law offices are still open and working with clients to ensure that all of your needs are addressed. If you need to set up a time to draft new wills, powers of attorney, or other documents, we’re here to help. 

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Have You Discovered Gaps in Your Financial Plans?

If you’ve done any financial planning at all, it’s common to feel like it’s a bit overwhelming to keep track of all the things you need to do or feel like you should be doing. But don’t let that keep you from taking these important steps to protect your interests and even your family in the future. Now is the perfect time to take a deeper look at how you can incorporate holistic estate planning and financial plan into your future.

The pandemic has encouraged many people to take a deeper look at their financial plans and uncover potential problems. Some people might not have even looked at their financial and estate plans over the past ten years because there have not been significant changes in account value. However, since the impact of the pandemic, many account values decreased tremendously. 

The pandemic has brought forward a focus on end of life planning but other reviews of your estate plan can assist you with discovering ways that you need to alter your existing planning. For example, executives should be looking at opportunities to convert their traditional IRAs to Roths as long as they are considering the taxes that a client might have to pay for the conversion. 

A consultation with your estate planning lawyer can be especially valuable right now given the challenges that have been presented by the pandemic and the opportunity to align and update your estate planning materials to ensure that they have your best interests and your intentions for your family members in mind.       

Looking at the big picture financially, it’s good to have someone else review your existing retirement, asset protection, and estate plan. Another person’s insight can help you see some of the gaps where you need to step up your planning efforts. No matter where you’re at now, our lawyers can help you put together a plan that helps protect you into the future. 

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Tips for Preventing Sibling Arguments Over Your Estate Plan

The last thing you want is for your loved ones to end up in court battling over the terms of your estate. In addition to piling on unnecessary stress and conflict during this period, issues like this can reduce the overall value of your estate, too.

You’ve thought carefully about your estate plan and what you hope to achieve with it and the assets you leave behind. You also have to think carefully about the message that you’ll be sending to your children when your estate plan is activated. 

Leaving behind unequal inheritances might make sense for your family but it can also pave the path for potential arguments and conflicts among the siblings who have received differing amounts. If you haven’t had the conversations about your decision to go this route, you need to think about your unique family dynamics. 

Leaving unequal inheritances isn’t the only way to find yourself facing these challenges. In fact, some children who have contributed more or might see themselves as having more substantial financial needs could be frustrated by a strictly equal distribution of assets. One of the first steps that you can take is to define what fair looks like for your family that might not be the same as what it looks like for everyone else, but the more carefully that you can think about this for your individual purposes the easier it will be to approach estate planning with care.      

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What’s the Appeal of Using a Trust?

A YouGov study found that over three quarters of Americans recognize that estate planning is essential but only 40% of people within the country do have a plan in place. A trust is one of the easiest ways to add some more control and protection into your estate plan, but it’s often overlooked because people perceive them to be too difficult or only aligned with different estate planning needs and goals.

One of the most common strategies to protect your interests and ensure that you have thought about estate planning at the high level is the use of a trust. Trusts are an excellent resource to use for wealth preservation due to potentially favorable treatment for your heirs, a greater layer of privacy and control. 

The perceived complexity that a trust is very difficult to create and put together is one of the most common reasons that people don’t use this tool. While it is true that some trusts can be very complicated, it is the variety of different kinds of trusts available for use that make it more likely for someone to skip over this estate planning strategy altogether. 

A consultation with an attorney can provide a great deal of clarity around whether or not trusts do make sense for your situation and how to decide what assets should be placed inside the trust. A trust might not make sense for everybody’s individual estate planning needs but it’s a good idea to talk with a professional about whether or not this makes sense for you and your family.       

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Have You Considered Your Chances of Disability?

Many people think of those who live with disabilities as people in older years or those who have been diagnosed with a disability at birth or very young in their life. The truth is that a disability can happen to anyone at any time as a result of an illness or an accident.

If you end up suffering in an unexpected accident or coming down with an illness that renders you unable to work, this will impact your life and the life of your family members in multiple ways. To guard against making such a situation even more difficult, it’s important to take precautions to protect your interests ahead of time with an incapacity plan. Enabling the right people to act quickly in the manner you intend for someone else to help you can make a world of difference when there are already so many things to consider about how you adapt to your new life.

Many younger people in America expect that disabilities only affect others, but thousands of young people are seriously injured due to traumatic events every single year. Many critical medical conditions can also mean that a person suffers from disability very suddenly, such as a mental illness or cancer. These can affect people regardless of their age.

In fact, for 20-year olds in the United States, there is a 1 in 4 chance of becoming disabled prior to reaching retirement age. Therefore, it can be especially dangerous to ignore the opportunities with estate planning and incapacity planning in advance. You should not wait until something happens to you or a loved one to make the decision that you want to have, your care well thought out and appropriately addressed in advance. Schedule a consultation today with an incapacity planning lawyer to learn more.

 

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Don’t Forget a Tax Strategy for Your Stock Options

Executive compensation packages have increasingly included stock options in the last several years. This means that from an estate planning perspective, you must think carefully about how and when these might affect you. Do you know how to maximize, for example, your stock options with a tax strategy?stock-option-estate-planning

Option based executive pay fell out of favor in the last 20 years but there are signs that it might have made a comeback as the stock market continued to grow. One major reason for this is that C corporations have become more attractive because of a 21% tax rate. Understanding stock options is critical for your overall financial picture and for estate planning purposes.

Stock options are a form of incentive compensation that are given to retain or reward valued employees. Typically up to 25% of that stock grant will last every year as a method for keeping employees at the company for a minimum period of time. Executives must have a comprehensive strategy that takes into account many different elements, including their personal balance sheet, their perception of risk, the company’s overall outlook and the stage that person is at in their life and career.

Speaking with experienced financial professionals and estate planning attorneys is strongly recommended if you have received stock options. The two primary types of stock options are nonqualified stock options and incentive stock options. The vesting of a compensatory stock option and a grant usually have no financial or tax implications. However, you’ll need to discuss the specifics of this strategy with your estate planning lawyer.       

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The Value of Estate Planning for Baby Boomers

A total of 22% of today’s population includes the baby boomer generation. Many of them are quickly reaching retirement age raising important questions about the value of estate planning.

Estate planning is so much more than passing along possessions and assets to millennial children. It is also about protecting their lifestyles and taking a long-range view towards the need for possible Medicaid support or other long-term care planning. The youngest baby boomers are turning 56 in 2020 and many of them have wealth that is expected to grow in the coming decades. 

Plenty of these baby boomers might not consider themselves wealthy outright but having a home, a second property, a car or money set inside a savings account means that you can still benefit from the strategies provided by an estate planning attorney.

This is because estate planning is more expansive than determining what happens to your possessions when you’re no longer around. It takes into account your individual decisions and preferences around long term care and health care. Schedule a consultation today with a knowledgeable estate planning attorney to discuss how this can fit into your plan as a baby boomer.     

Our law office is still open but helping our clients over the phone and virtually. Don’t hesitate to reach out to determine how we can help you connect your estate plan, your elder law plan, and your retirement plan. 

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Property Tax Relief is Coming for New Jersey Homeowners

An executive order from Governor Phil Murphy now means that municipalities can update their property tax payment deadline from May 1st to June 1st. According to research completed by The Tax Foundation, The Garden State is actually home to the highest mean effective property tax in the entire country at 2.21%.

This gives homeowners in New Jersey a little bit of breathing room in their taxes. Now is a really good time to evaluate your current tax obligations across the board. 

Do you have appropriate tax planning strategies in place to protect your estate as well as taking into consideration the possibility of needing long term care in the future? Schedule a consultation with an experienced New Jersey estate planning lawyer if you have more questions about the best way to protect your interests. 

Do you have planning in place for what will happen to your property if something happens to you? Do you own other real property either in New Jersey or in a different state? You need to plan for this as part of your asset transfer strategy. 

Tax strategy planning can go a long way in helping you to avoid problems and potential disputes down the line. When your estate enters the probate process, the work you’ve already done in terms of planning will help your family members during this difficult time and ensure a smooth transfer of your property using the tools you’ve already outlined. 

Schedule a consultation with a lawyer who is very familiar with state and federal taxes and how they fit into the bigger picture of your estate plan.