In general, estate planning is a process of managing your assets. It is created during your lifetime and can serve to minimize taxes, avoid lawsuits, and properly distribute your assets. Many people wonder if they should plan their estate. Having an estate plan is always in the best interest for you, your loved ones, and the legacy you leave behind. Here are the top three reasons why estate planning can be useful to you:
- Protect Children or Beneficiaries
One of the top reasons to create an estate plan is to protect the people you are leaving behind: your children, your spouse, and other family members, or friends. You don’t want to lose your assets to creditors, or for your family to fight over how your assets should be distributed amongst themselves. If you are leaving children behind, having an estate plan in place is especially important, because they depend on you financially. Having an estate plan would allow you to establish a trusted legal guardian for your children, determine how you want your children to be raised, and appoint who inherits your assets if you become incapacitated or pass away.
- Avoid Probate
Probate is the process of providing a Surrogate’s court with evidence to uphold the validity of the deceased person’s will. Having your assets go through probate is a long, pricey procedure and is an overall hassle. It could tie up your estate and costs thousands of dollars in legal fees and other expenses. Another reason to avoid probate is that it is handled in court system and all of the information submitted by you becomes public records. Avoiding probate would keep your personal matters private. One way to avoid probate is to create a trust rather than a will. A trust does not have to go through probate to validate and it is much quicker to transfer your assets to the beneficiaries.
- Reduce Taxes
Any property that an individual owns, including bank accounts and cash, can be subjected to taxation. Estate taxes can be very high and are imposed on an heir’s portion of an estate. This excludes the inheritance of a spouse due to the unlimited marital deduction. Since the estate tax is so high at 40%, it is only levied on estates exceeding 11.2 million dollars. Although the exemption amount is very high, it does not mean that estate planning is only necessary for the wealthy. One reason is that states have a lower estate tax exemption limit than the federal. However, basic estate planning can help to eliminate these unnecessary estate taxes.
Take the next step
Estate planning is there for your convenience and to make life easier for you and your loved ones. If you have any further questions concerning estate planning in New York, don’t delay. Contact the Law Office of Inna Fershteyn at (718) 333-2394 or visit our website to schedule a consultation. We are conveniently located on Voorhies Ave right next to the B and Q train station.