Estate administration takes both time and energy.
You have assets.
This means you have an estate.
When you die, someone will need to wrap up your final affairs.
According to a recent Winston-Salem Journal article titled “Practical tips for estate administration, pre-planning advice, and a Coronavirus update,” the executor is in charge of paying any debts, filing any estate-related tax returns and your final income tax return, and distributing assets.
If your planning is poor, it can cause estate administration errors and issues in the future.
What are potential problems?
Not utilizing a trust when your estate needs one.
When funded, a revocable living trust holds your assets and distributes them to your beneficiaries according to the instructions outlined in the trust.
Since such a trust avoids probate, this can keep your affairs private while simplifying your estate administration.
Not updating your estate plan.
Laws and family situations change with time.
Have you updated your estate plan in the past three or four years?
If no, you should met with an experienced estate planning attorney to review your plan.
Tax laws have been updated in the past few years as it relates to estate planning, to include planning for retirement plan distributions following the SECURE Act became law on January 1, 2020.
You may want to revise your documents to align with these tax law changes.
Inheriting real estate jointly.
Did you and your siblings inherit the family home together.
Are you in the process of selling the property?
Take steps to do this as soon as possible.
Handling the property during estate administration can be further complicated when one of the siblings moves or dies.
Not reviewing your power of attorney.
Your power of attorney documents are essential to incapacity planning.
With outdated documents, your agent may not be able to act on your behalf.
You may also choose to change the agent.
If you neglect to do this, you may have your ex-spouse making your medical and financial decisions.
To fix potential issues in estate administration later on, schedule a time now to meet with an experienced estate planning attorneys to get your affairs in order.
As with most matters of personal responsibility, it is always is more prudent to prepare than to repair!
Reference: Winston-Salem Journal (May 3, 2020) “Practical tips for estate administration, pre-planning advice, and a Coronavirus update”