Estate Planning During Covid-19
The Covid-19 pandemic has caused major problems for us financially, but additionally has many people thinking about their mortality. When situations like this occur, one of the first things people think about is their family. What happens if I die? It is more important now then ever before to ensure that your family is protected. One of the best things you can do is to create a trust (also known as an estate plan). This plan will protect your assets from probate, can be amended to protect from death taxes (which will be applicable in 2021), and give you asset protection.
Sometimes, people ask if they can just list a beneficiary on a particular asset, and by doing so, will that protect the asset for the benefit of their family. The answer is it depends on what you are trying to protect. If you want to transfer a house to someone and you are listed as joint tenancy with the right of survivorship, then yes the property will transfer to the survivor upon your death, avoiding probate. However, it does not give asset protection, and may not protect from death taxes depending on the exemption amount and the recipient’s relationship to you.
If you are dead set against creating an estate plan, there are some options available. Some of these include, transfer on death deeds, listing contingent beneficiaries on your financial accounts, or simply transferring all of your assets to your beneficiaries before death. However, the best to do is to create an estate plan. Remember, legal fees are usually tax deductible up to a certain amount. So, if you do inquire about an estate plan, ask whether the fee charged is tax deductible. In our office the whole process can be done virtually, so you don't even have to leave your house.
If you have any questions, or would like a free legal strategy session, please call us!