Estate planning: Will Congress make it unnecessary?
Lately there's been a lot of talk in Washington about
repealing the federal estate and gift tax. Last year Congress passed a bill containing
such a provision, but President Clinton vetoed the bill, claiming it would benefit only
the rich. If the estate tax is ever repealed, will estate planning become a thing of the
past?
For most people, the answer is no.
Your will. A key component to most estate plans is having a will drawn up. In your will,
you designate how each of your assets (excluding those assets that have named
beneficiaries or are held jointly with right of survivorship) will be distributed upon
your death.
If you have young children, your will should name a guardian for your children and
trustees for the assets that they will inherit. And if you have heirs who aren't as
financially responsible as you would like, you can designate in your will that their
inheritance be held in trust.
Other documents. In addition to your will, two documents essential to your family's
financial well-being are commonly drafted during the estate planning process. A durable
power of attorney allows another person to make financial decisions on your behalf if you
become incapacitated, and a medical directive or "living will" sets out your
preferences for medical treatment if you become too ill to communicate these wishes
yourself.
Business owners. If you're a business owner, estate planning will still be a must. Even
though businesses will no longer need to be sold or leveraged in order to pay estate
taxes, proper succession planning is needed to ensure that your business will pass to your
heirs as smoothly as possible.
Since the rules surrounding estate and gift taxes are very complicated and continually
changing, please give us a call if you would like to discuss your current estate plan.
See also:
Handling Estate Financial Issues
© Copyright 2001 Raymond S. Kulzick. All rights reserved. 010105.
This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.