Most Washington, DC residents know that having an estate plan is important, but many people may not fully understand why. Estate planning does more than just pass on assets to heirs or provide for the unlikely event of incapacitation. There are two other important issues to consider when putting together an estate plan -- taxes and sheltering assets.
For many people, the current federal estate tax exemption is high enough to guarantee their estate will not owe federal estate tax. Therefore, estate plans do not need to be as complex as they were in the past. However, laws may change at any point. A potential tax overhaul could change the current regulations, and state estate taxes in some jurisdictions still need consideration (Nevada currently does not levy a state estate tax). Some people may still need to structure their estate plan to avoid paying estate taxes to their home state or another state in which they own assets.
Some professions lend themselves to possible litigation such as doctors, builders and lawyers. Many of these, and other, professions use estate planning to keep their assets out of the reach of creditors and litigants. This strategy is not only effective for them, however. Anyone concerned about their own financial problems -- or those of an heir -- may find the use of certain trusts as a viable means to protect assets.
No matter what a Washington, DC resident's estate planning goals are, it is likely a plan can be devised to achieve those goals. It may be comforting to know that, after a lifetime of building an estate, as much of it as possible will be passed on to family and other loved ones. The good thing is that estate plans are not written in stone. They may be changed at any time as the need arises and laws change.
Source: nevadabusiness.com, A Primer on Estate Planning: Be Prepared, Norman Bell, Dec. 2, 2013