It is important to review your existing estate plan periodically to determine if it continues to meet the needs of your family and appropriately addresses tax considerations in light of ongoing changes in federal and state estate tax laws. We recommend a review of your estate plan when there is any change in your personal or financial circumstances, and particularly in the following situations:
You have added or lost family members. If your family has expanded, whether by birth, marriage or adoption, you will want to review your estate plan to ensure that it fulfills your wishes. New family members may raise particular concerns about the need for asset protection or special needs trusts. If your family has lost a member to death or divorce, you will want to review your estate plan to ensure that it is still effective. You may also need to designate a new fiduciary if that family member was named as your executor, health care representative, or trustee.
If you are married, and you have not recently reviewed the ownership of your assets. Changes in the federal and state estate tax laws and the relationship between the two may suggest altering the way you and your spouse own assets.
You are considering purchasing a new life insurance policy. Life insurance can be an important part of an estate plan. The ownership and beneficiary of life insurance should be carefully considered in the context of your plan, ideally prior to acquisition of a new policy.
You have not recently reviewed the beneficiary designations of your retirement benefits and life insurance. It is important to coordinate your beneficiary designations with your estate plan to ensure your estate plan works as you intend.
You purchased real estate. Primary residences, investment property, and vacation homes are unique assets that require special attention in estate planning, especially if the property is located outside of Michigan.
You own a business. If you own a business, or an interest in a business, you must take care to ensure that the business operations can enjoy a smooth transition to family or business partners after your death, and minimize potential disagreements.
You want to make full use of your gifting opportunities. Lifetime gifts can be an important planning tool to minimize estate taxes, shift wealth to the next generation and provide financial assistance to family members or other beneficiaries and reduce total income taxes during your lifetime.
Lifetime gifting opportunities may include tax-free gifting through the annual gift tax exclusion, educational and medical funding and qualified personal residence trusts.
The value of your estate has changed substantially. A substantial increase (or decrease) in the value of your estate can have tax implications and may change the way you wish to structure your estate plan.
You wish to establish and fund a revocable trust. You may want to take steps to transfer your assets to a revocable trust to manage your assets during your lifetime and avoid probate proceedings to distribute those assets after your death.
It has been three or more years since you last reviewed your estate plan. It is prudent to review your fiduciary appointments, plan of asset disposition and beneficiary designations periodically, even in the absence of any of the foregoing events, to confirm that your estate plan reflects your current wishes and is appropriate in light of current tax and probate laws.
*RANDALL A. DENHA, J.D,, LL.M., principal and founder of the law firm of Denha & Associates, PLLC with offices in Birmingham, MI and West Bloomfield, MI. Mr. Denha continues to be recognized as a “Super Lawyer” by Michigan Super Lawyers in the areas of Trusts and Estates Law; a “Top Lawyer” by D Business Magazine in the areas of Estate Planning and Tax Law; a Five Star Wealth Planning Professional and a New York Robertes Top Attorney in Michigan. Mr. Denha can be reached at 248-265-4100 or by email at firstname.lastname@example.org