Posts Tagged Estate Planning

Taxes on Social Security Benefits and How to Avoid Them, Continued

On September 1, 2020   /   Blog  
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Taxes on Social Security Benefits and How to Avoid Them, Continued

An article on kiplinger.com offers some strategies to avoid, or at least mitigate, taxes on Social Security benefits. Withdraw money from your tax-free Roth IRAs. Tax-free withdrawals from a Roth IRA or Roth 401(k) are not included in your adjusted gross income. Rolling over money from your traditional IRA or 401(k) to a Roth IRA years before you start receiving Social Security benefits is an excellent way to avoid taxes later in retirement. Of course, you will have to pay income taxes when you make the conversion, but you can tap the account tax-free after that. Purchase a Qualified Longevity Annuity Contract. You can invest up to $130,000 from your IRA or 401(k) in a deferred-income annuity called a Qualified Longevity Annuity Contract (QLAC). The money in your QLAC is ignored when figuring your required minimum distribution, so you can reduce the size of your distribution, lower your income and

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Taxes on Social Security Benefits and How to Avoid Them

On August 25, 2020   /   Blog  
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Taxes on Social Security Benefits and How to Avoid Them

Many people are surprised to learn that their Social Security benefits can be subject to federal taxation. Whether your benefits are taxed depends on what is known as your “provisional income.” This is your adjusted gross income (not counting Social Security benefits) plus nontaxable interest and half of your Social Security benefits. For people filing as individuals or heads of household with provisional incomes of less than $25,000, Social Security benefits are not taxed. For couples filing joint returns, the figure is $32,000. Unfortunately, individuals with provisional income of between $25,000 and $34,000, or couples filing jointly with provisional income of between $32,000 and $44,000, up to 50% of Social Security benefits may be taxable. In the case of individual filers with provisional incomes above $34,000 or joint filers whose provisional incomes exceed $44,000, up to 85% of Social Security benefits may be subject to taxation. The information above concerns

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Five Trusts That Can Help You Accomplish Specific Planning Goals

On August 18, 2020   /   Blog  
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Five Trusts That Can Help You Accomplish Specific Planning Goals

Trusts come in many “flavors.” Here are five trusts that can be used to achieve specific planning goals. Generation-Skipping Trust (GST) Let’s say your son has remarried and you’re worried that his second wife might not pass his inheritance to the children from your son’s first marriage—that is, your grandchildren. Or maybe one of your children is not responsible enough to handle an inheritance on his or her own and you want to make sure your grandchildren will receive a portion of your assets. With a Generation-Skipping Trust, the assets put into the trust will be transferred to your grandchildren when the GST goes into effect. A GST does not necessarily disinherit your children. The trust can be structured so that your children can draw on the income/earnings from the trust while your grandchildren stand to inherit the balance of the trust. Qualified Terminable Interest Property Trust (QTIP) A QTIP

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Three Factors To Keep In Mind When Buying Long-Term Care Insurance

On August 11, 2020   /   Blog  
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Three Factors To Keep In Mind When Buying Long-Term Care Insurance

Many families consider purchasing long-term care insurance in advance to help pay for expensive long-term care in the future. Here are three important factors to keep in mind when buying long-term care insurance. Your daily benefit requirement. Many people look at the national averages for long-term care costs and neglect to factor in regional differences. Don’t make this mistake. Be sure to find out the care costs where you live now or where you want to reside in the future. Timing. The issue here is two-fold: The age at which you apply for the policy initially, and the waiting period you choose for the policy to take effect before you begin receiving benefits. Typically, the younger you are when you apply, the cheaper your policy. Of course, the benefits of the lower premium must be factored in against the amount of time a younger person will likely continue to pay

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How to Augment Your Retirement Income

On August 4, 2020   /   Blog  
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How to Augment Your Retirement Income

Most people rely on IRAs, 401(k)s and Social Security benefits to fund their retirement. An article in U.S. News & World Report explored some other options to boost your retirement income. Here are some highlights. Renting out part or all of a home. If your children are on their own, you may have more house than you need. Renting out a room, or making improvements like a kitchenette and bathroom to create an “apartment” within your home, can have a dramatic impact on your income. If you don’t like the idea of having a permanent housemate, websites such as HomeAway and Airbnb allow you to rent out a room or your entire home on a temporary basis. Taking out a reverse mortgage. If you are a homeowner age 62 or older, you can use a reverse mortgage to receive regular payments based on the equity in your home. However, when

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Six Reasons to Revise Your Estate Plan

On July 28, 2020   /   Blog  
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Six Reasons to Revise Your Estate Plan

For your estate plan to meet your needs, it must be kept up to date. We recommend having your plan reviewed at least once every two years, but there are certain situations where you should have your plan revised immediately. Here are some of the most common reasons to do so. You get married. Getting married, or re-married, doesn’t automatically change the provisions of your will or trust. While marriage can give each spouse some rights with regard to one another’s property, you should have your plan revised to make sure it addresses your new goals and those of your spouse. You get divorced. Providing for your spouse is likely one of your estate plan’s most important goals. If your marriage ends, chances are you will no longer want your spouse to receive the majority of your estate. You should update your plan as soon as possible after a divorce

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Estate Planning Fundamentals

On July 21, 2020   /   Blog  
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Estate Planning Fundamentals

Clients often ask us about the estate planning tools we use and what each of them can accomplish. Here is a list of the most commonly used tools and brief descriptions of their purpose. Last Will and Testament This allows you to specify “who gets what” when you pass away. Without your own Last Will and Testament, your assets will be distributed according to state guidelines. A Will also allows you to name guardians for your minor children. This is important because if something happens to you and your spouse, the state will decide who will have legal authority over your minor children. This could very well be a person or institution you would never have chosen to have such authority. Durable Powers of Attorney These allow you to name people of your own choosing to make decisions for you in the event of incapacity. A power of attorney for

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Four Reasons You Might Want To Use A Corporate Trustee

On July 14, 2020   /   Blog  
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Four Reasons You Might Want To Use A Corporate Trustee

A trustee can be one person, multiple people, or what is called a “corporate trustee,” such as a bank or trust company staffed by people who manage and grow trust assets. People name corporate trustees for a variety of reasons, including: Necessity If you have no one you can count on to administer your trust, or you don’t want to burden a loved one with the responsibilities of serving as trustee, a corporate trustee may be the way to go. Avoiding family disputes When one member of the family is named as trustee, other family members might feel slighted. This can lead to arguments and even legal disputes. A corporate trustee is unbiased and can help eliminate infighting between family members. Also, if you are unhappy with how trust assets are being managed, it is much easier to fire a corporate trustee than, say, your eldest son. Experience In the vast

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Here’s What Can Happen If You Don’t Have An Estate Plan of Your Own, Continued

On July 7, 2020   /   Blog  
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Here’s What Can Happen If You Don’t Have An Estate Plan of Your Own, Continued

In this post, we’ll continue our discussion of why everyone needs an estate plan. Loss of Control Losing control over how your assets are distributed after death isn’t the only negative consequence of failing to plan. You and your family may suffer physically, financially and emotionally while you are still alive. For example, a properly designed and implemented plan allows you to name people you trust to make medical and/or financial decisions on your behalf if you become incapacitated. Without a plan, someone will petition the court for the right to make these important decisions for you. The court could very well decide to choose a person or persons you would never have wanted to have such authority. The result? You may not receive the level of medical care you would have wanted. Conversely, you might be subjected to medical procedures you would not have wanted to keep you alive

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Estate Planning and Alzheimer’s Disease

On July 2, 2020   /   Blog  
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Estate Planning and Alzheimer’s Disease

While everyone should have an estate plan, it is especially important for families living with Alzheimer’s disease. If you or a loved one has recently been diagnosed with Alzheimer’s, and you do not have estate planning documents like a will, Power of Attorney, or advance directive, please contact our office as soon as possible. Estate planning documents require the person who signs them to have the legal capacity to understand the documents’ consequences. In most cases, someone who has just received a diagnosis of Alzheimer’s can understand the meaning and importance of a given document and therefore has the legal capacity to sign it. However, the ability to understand the implications of legal documents may decline as the disease progresses. We can guide you through all the legal ramifications surrounding an Alzheimer’s diagnosis, including medical and asset protection planning, advance directives and guardianship. We understand what you are going through

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