An estate that is worth more than $1 million is a bit more common in New York than in other states, but for much of recent history, those residents were hit with a 16 percent state tax on their estates. This led to many New Yorkers moving out of state to more tax-friendly locations to ensure that heirs were able to keep as many estate assets as possible. Recognizing the drain of these estates to other locations, legislators have implemented a gradual plan making golden years in New York much more attractive.
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Every year until 2019 the exemption will increase based on what day the individual in question passes away. Since small nuances in the law and a minor mistake could lead to bigger tax consequences, those with estates above $1 million should conduct an annual review of their tax planning to verify asset maximization. Even being off by one cent can throw off an entire plan, so it’s vital that regular review and analysis are used to help protect the estate. The new exemption is increased by $1,062,500 every year until reaching the federal exemption amount in 2019. At present, some New Yorkers have looked to DING and NING trusts, those trusts held in other states to reduce tax consequences.
This move, combined with estate tax changes that exempt small businesses from massive taxes after an owners death and decreases in the state’s corporate tax rate, were applauded by the tax policy research organization Tax Foundation. The organization noted that it these were important steps towards improving the reputation of ease of doing business within the state. All of the recent changes were adopted in the most recent state budget, details of which were released at the end of March. Special planning for New York tax liability can be completed by an estate planning specialist. For tax planning strategies, email firstname.lastname@example.org or contact us via phone at 732-521-9455 to get started.
Who should raise your children if, for some reason, you or your spouse is unable to do so? It’s not an easy question to answer, but if you have young children, it is a topic you most certainly should address in your estate plan. Otherwise, a court will decide, and its decision might not be the one you would have made. It may not even be in the best interests of your children.
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Some of the most important issues to consider when choosing a guardian include:
- Does the prospective guardian have a genuine interest in your children’s well-being?
- Does the prospective guardian share your values?
- Can he or she handle the role physically and emotionally? What about financially, if you cannot provide him or her with enough assets to raise your children?
- Does the prospective guardian already have children of his or her own? Will he or she have enough time to adequately care for and look after your children?
- Where does the prospective guardian live? Would that be a good fit for your children? Would having to move far away make an already stressful situation for your children even more so?
- Is it essential that all your children share the same guardian? Most parents say yes, but in some circumstances, such as when your children are of significantly different ages, naming more than one guardian is an option.
- Should you choose one person to act as personal guardian and another to manage the financial arrangements for your children—that is, name a second person to act as custodian or trustee? In certain situations, such as when the best surrogate parent for your children is not necessarily the best person to handle financial matters, this option is worth considering.
- Most important of all, have you spoken to the prospective guardian about taking on such a responsibility, and does he or she seem readily willing to do so?
We have helped many couples select the ideal guardian for their children and designed wills or other planning documents to ensure their wishes are carried out. We welcome the opportunity to do the same for you.