Irrevocable Trusts have long been an effective, albeit static, estate planning tool. These trusts didn’t always change with circumstance, but now they can. Sometimes circumstances change in ways you never anticipated when signing your irrevocable trust. While you cannot reverse time, there are a few ways that you might be able to modify an irrevocable trust. This first part of a three-part series explores changes to irrevocable trusts using judicial and nonjudicial modification. The … [Read more...] about Changing “Irrevocable” Trusts Through Judicial and Nonjudicial Modification
This is the second in a two-part series on Roth IRAs. The first part reviewed the basics of Roth IRAs. (Click here for the first article in the series.) This second part looks at two advanced planning strategies. The first advanced planning strategy is to use a Roth IRA to maximize the deferral on an inherited IRA. Prior to the SECURE Act, beneficiaries could take distributions over their life expectancy. For those dying after 2019 with IRAs, the SECURE Act applies. Under the Act, most … [Read more...] about Roth IRAs Can Be a Great Planning Strategy: Advanced
Roth IRAs can be a great planning strategy. They can save taxes and help in many ways. This is the first in a two-part series on Roth IRAs. This first part will look at the basics of Roth IRAs. The second part will look at more advanced planning strategies. An Individual Retirement Account (IRA) is a savings vehicle in which a deduction may be taken upon contribution (with limitations). The maximum contribution in 2021 is $6,000, and those age 50 and over may contribute an additional … [Read more...] about Roth IRAs Can Be a Great Planning Strategy: Basics
Occasionally, those who aren’t Estate Planning attorneys will attempt to do their own Estate Planning. They think they can find a document online or use a friend’s document and can figure it out. Unfortunately, there are many pitfalls one could run across. Let’s look at three of these pitfalls which one must sidestep. Bill and Mary had a house worth $500,000, an IRA worth $500,000, and investments of $500,000. They have three children, Aaron, Betty, and Charlie. At the death of the … [Read more...] about Dangers of Do-It-Yourself Estate Planning
ABLE accounts are a nice, flexible way to supplement the usefulness of a Special Needs Trust. But certain limits apply. by Steve Hartnett The Achieving a Better Life Experience (ABLE) Act allowed accounts to help people with disabilities (and their families) save and pay for disability-related expenses. ABLE allows states to create tax-advantaged savings programs for eligible people with disabilities. Distributions from ABLE accounts are tax-free if used for qualifying disability … [Read more...] about ABLE Accounts Complement Special Needs Trusts
Planning is important when providing for your children or grandchildren. But planning for their education has special importance and may have special advantages. This article looks at how 529 plans may have tax advantages when providing for education. Further, the article looks at how such a plan may provide asset protection in bankruptcy, as well. by Steve Hartnett A 529 plan, otherwise known as a qualified tuition plan, is a tax-sheltered way of saving for education expenses. 529 … [Read more...] about 529 Plans: Planning for Education with a Tax and Asset Protection Bonus
An ABLE account is a great strategy for someone who became disabled by age 26. An ABLE account may be income tax-free. It has other unique benefits for a disabled person. Read on to learn more about the ABLE account and how it can help. by Steve Hartnett ABLE accounts are like Section 529 plans. But, while 529 plans are for education expenses, ABLE accounts (under Section 529A) are for qualified disability expenses. While a 529 plan may be set up for anyone, an ABLE account only … [Read more...] about What is an ABLE Account?
Clients often come to an Estate Planning attorney with specific ideas in their minds. The attorney’s role is to counsel them regarding their plan, not just to draw up documents to accomplish it. by Steve Hartnett What’s the role of an Estate Planning attorney? Is it merely to document a client’s wishes? Or is it to counsel the client regarding those wishes and then craft a plan that best fits their situation? Clearly, it’s the latter. For example, if a client walks into your … [Read more...] about The Role of the Estate Planning Attorney
Tax proposals would increase capital gains rates, among other things. These proposed changes could make a Charitable Remainder Trust look even better. A Charitable Remainder Trust can earn the donor an income tax deduction upfront and defer gains on its sale of assets. by Steve Hartnett There are many current tax proposals. One of the many proposals is an increase in capital gains taxes. Currently, federal law taxes capital gains at a maximum rate of 20%, plus a 3.8% surcharge … [Read more...] about CRT: Best Tool for Proposed Tax Changes?
Senators Sanders and Whitehouse have introduced legislation in the Senate which would significantly alter the Estate Planning landscape. It would dramatically change the tools we use to plan for our clients. Time is of the essence. by Steve Hartnett 0 Comments Every year there are numerous tax proposals. These proposals run the gamut. We start paying attention when there’s a change in power in Washington, D.C., especially when there’s not divided government. Right now, Democrats … [Read more...] about Tax Proposals Could Alter Estate Planning Landscape