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Alan G. Orlowsky
(847)325-5559 |
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A colleague of ours recently
assembled a list of the top 10 estate planning issues.
This list is a great tool to assure that nothing is
overlooked.
All of them can be dealt with a little
thoughtful consideration. They can also create major
problems if not dealt with in advance.
Probate –
Court supervised administration of your estate is never a
pleasant journey. Despite the helpful court personnel,
there are still filing fees, lack of privacy issues, and
long waiting periods before distribution. And that’s if
all goes well.
Asset Protection – Many people do
not take advantage of the asset protection opportunities
that can be achieved with relatively basic estate
planning. Creating trusts for spouses and children with
the right provisions means your assets can be protected
from claims of creditors and predators for years to come.
While we hope that our children would not fall victim to
divorce, this is one asset protection conversation that
must be planned for.
Tax Planning – This is never
an easy issue as the various tax systems don’t always line
up with each other. Consider the tension between gift
planning, (giving away some of your assets) to shelter
appreciation by moving them outside of your estate, and
loss of basis for capital gains purposes. While not easy,
this issue can really cost you money if not properly
handled.
Family Disharmony – Estate planning is a
way for you to say you care about your loved ones. But
choices you make for executor or trustee can bring back
lots of bad memories for those not chosen. Giving thought
to how to help resolve these conflicts or at least, not
make them worse, can help to avoid family conflicts.
Attorney's Fees – The best way to control legal fees
is to incur them while you are alive and able to oversee
the planning process. Failure to plan is likely to
increase the total amount of fees paid. Especially if
family members decide that fighting is the best way to
resolve disputes after you’re gone.
Successor
Fiduciaries – Make sure that you name back up executors
and trustees, or provide the beneficiaries with a way to
fill a vacant role, so that a court proceeding is not
required.
Contingent Beneficiaries – Make plans for
your estate in the event that your immediate family
members die and are unable to inherit your estate. Pick a
charity or a group of more distant relatives or close
friends.
Updating Beneficiary Designations - Life
insurance and retirement accounts are controlled by the
beneficiary designations you make when you purchase the
life insurance or open a retirement account. They are most
notably the small boxes you checked at the end of your
application. Make sure these stay updated. We have seen
more than once a policy which still names a client’s first
wife or husband many years after a divorce and remarriage.
Joint Accounts – Often used as a convenience during
life and a will substitute at death. Because these
accounts go to the survivor, make sure that this lines up
with your overall plan of passing assets to your heirs.
Leaving money in a joint account for one child with the
idea that they will spread the wealth around after your
death can be a recipe for disaster.
Failing to start - Procrastination is
probably the leading cause of problems in estate planning.
Once a disability or death occurs, planning becomes very
difficult and lots more expensive, if possible at all.
If you have questions,
click
here to have our office call to set up a time to
discuss this with you.
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The information contained on this web page is general by its
nature. For that reason, no one should take any action based on
the information contained in this webpage until having consulted
a competent professional advisor or advisors. Nothing contained
in this web page was intended or written to be used, can be used
by any taxpayer, or may be relied upon or used by any taxpayer
for the purposes of avoiding penalties under the Internal
Revenue Code. No information contained on this webpage relating
to any federal tax matter may be used by any person to support
the promotion or marketing or to recommend any federal tax
matter. Taxpayer should seek advice based on the taxpayer's
particular circumstances from an independent tax advisor with
respect to any federal tax transaction or matter described on
this webpage.
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Orlowsky & Wilson, Ltd. | 250 Parkway Dr., Suite 150, Lincolnshire, IL 60069 |
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