Estate Planning: Non-Tax Reasons

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Estate Planning

• Non-Tax Reasons to Plan

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Avoiding, or decreasing, an estates tax burden
is often a motivation behind estate planning
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While tax avoidance is certainly an important
goal of a comprehensive estate plan there are
other important reasons to create an estate plan
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Incapacity
Incapacity may be the most important reason to
create an estate plan
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Without an incapacity plan healthcare decisions
may default to someone unintended
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An advance directive, healthcare POA, or similar
document lets you decide who will make healthcare
decisions if you become incapacitated
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End of life decisions can also be made in a
separate document
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A property POA allows an agent to control
property in the event of your incapacity
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Division of Assets
Most common reason people give for estate planning
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Particularly important if you do not want your
intestate heirs to inherit
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Allows you to gift to an unmarried partner,
friend, or charity
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CONFLICT AVOIDANCE
An estate plan allows you to make your wishes
clear
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This is particularly important if you are making
non-traditional choices
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Sharing your plan lets beneficiaries and heirs
know ahead of time what to expect which often
decreases the possibility of conflict
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GUARDIANS
If you and your childs other parent are both
unable to care for your child a court will have
to appoint a guardian
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Applies to parents and other dependent loved ones
as well
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The court will make the decision without
guidance or input from you.
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A complete stranger could be appointed
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By nominating a guardian in your plan you can
influence the courts appointment when the time
comes
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MANAGERS
Someone will need to manage your assets when you
die
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Your estate plan lets you decide now who the
managers will be
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By creating a trust you can appoint a trustee to
manage the trust
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Trustee can be a loved one or professional trustee
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Assets can be transferred to the trust for
safekeeping
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Good option if you have minor children
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Beneficiaries can benefit from the trust while
guarding assets until they are old enough to
manage them
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PROBATE AVOIDANCE
Probate avoidance is a common estate planning
goal for many reasons
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Probate can take months, even years, to complete
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Assets are frequently inaccessible to intended
beneficiaries during probate
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Probate may be costly diminishes the value of
the estate
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Probate is public
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COORDINATING WISHES
A comprehensive estate plan lets you coordinate
your wishes in a way that will ensure that they
are carried out in the future
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Often, there are multiple steps required to
ensure that a gift of property is carried out,
for instance
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Your estate planning attorney will make sure
everything is coordinated so there are no
glitches when the time comes to transfer property
or distribute gifts
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Non-Tax Reasons Prevail
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Although tax related considerations are often the
motivation behind the desire to create an estate
plan
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Although tax related considerations are often the
motivation behind the desire to create an estate
plan
it should be clear that there are numerous
non-tax reasons for creating an estate plan that
are of equal, or greater, importance
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By Stephen C. Hartnett, J.D., LL.M. Associate
Director of Education American Academy of Estate
Planning Attorneys 9444 Balboa Avenue, Suite
300 San Diego, California 92123 Phone (858)
453-2128 www.aaepa.com Get free important
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