Estate Planning
David Postic
Top 7 Reasons People Delay Making An Estate Plan

According to a survey conducted earlier in 2019, only 40% of American adults have a Will or Trust. That percentage drops dramatically for younger age groups. For example, only 19% of people ages 18-34 have a Will or Trust.

So what’s the big deal?

As Baby Boomers pass away, experts predict that over $68 trillion (with a ‘trill’) in wealth will be transferred over the next 25 years. And the estate planning of those Boomers will control where all that wealth goes.

Despite the hugeness of those numbers and the importance of estate planning, it is easy to procrastinate when it comes to actually setting your affairs in order. Here are the top 7 reasons (in no particular order) people give us to explain why they delay estate planning:

1. “I’m too young.”

First of all, you are never too young to have an estate plan. I wrote a series of articles specifically geared toward estate planning for Millennials. (Or you can substitute “Millennials” for “Gen Z” or whatever weird thing we are on now.)

Whenever young people say “I don’t have enough assets for an estate plan” or “I’m going to wait until I have a family,” what they are really saying is, “I don’t plan on going anywhere anytime soon.” Because young people don’t die, they live forever.

Top 7 Reasons People Delay Making An Estate Plan
Estate Planning, Taxes
David Postic
Everything You Wanted To Know About Estate ...

The Internal Revenue Service (IRS) recently announced that the estate and gift tax exemption is increasing in 2024 to $13.61 million per person, up from $12.92 million in 2023.

The IRS also confirmed that the annual gift exclusion amount is increasing from $17,000 per person in 2023 to $18,000 per person in 2024.

Read more: IRS Rev. Proc. 2023-34

Okay great, you might be saying to yourself. But what does that mean, and why does it matter?

Great questions.

There are a lot of misconceptions about estate taxes and gift taxes — often referred to as “death taxes.” What they are, who has to pay them, how to avoid them.

This article is my attempt to demystify the topic for you and to help you figure out how these tax changes could affect your estate plan.

Everything You Wanted To Know About Estate & Gift Taxes
Estate Planning
David Postic
8 Questions to Prepare Your Estate Plan for 2024

2023 is almost over.

The end of the year is a time for people to gather together with family and friends, to look back on the past 365 days, and to look forward to better, happier things.

People usually don’t want to think about things like—oh, I don’t know—their mortality. Death. Stuff like that.

However, it is crucial to regularly review and, if needed, update your estate plan. The end of the year is the perfect time to do that.

So before you completely wipe 2023 from your memory, ask yourself these 8 questions to make sure your estate plan is ready for whatever 2024 throws at you.

1. Will the right people get my “stuff”?

First, make sure your will or trust correctly states who will inherit your assets.

You should then review your pay-on-death (POD) beneficiaries on insurance policies, retirement accounts, and other assets.

Do they match the beneficiaries in your will or trust?

Related post: 7 Mistakes to Avoid When Naming Beneficiaries

Many people incorrectly believe that a legal document such as a will or a trust controls what happens to all of their assets.

However, beneficiary designations can override those documents.

For example: Your trust may say that your son John will receive your entire estate and that you are disinheriting your other son, David.

But if your insurance policy lists David as beneficiary, he will still get part of your estate.

You should therefore coordinate your beneficiary designations with your will or trust to make sure all of your assets are distributed the way you want.

8 Questions to Prepare Your Estate Plan for 2024
Estate Planning
David Postic
What's the Difference Between a Will and a ...

Lawyers love to be confusing.

We use insane-sounding words from Latin and Greek and some other languages that I’m pretty sure are completely made up.

Words such as testator, force majeure, per stirpes, and inter vivos.

Our words are so weird, we have to italicize them.

So I’m not surprised when someone asks me whether a Last Will and Testament and a Living Will are the same thing.

After all, both documents have “Will” in their names, right? It would only be reasonable to think that they are similar.

But they are not similar. They are very, very different.

So I’m going to cut through the legal jargon and explain the differences between Wills and Living Wills — and help you decide which one might be best for you.

Last Will and Testament vs. Living Will

Before diving into specifics, it’s first helpful to know how to define estate planning:

An estate plan ensures (1) that the right people are able to care for your SELF in the event you become incapacitated and (2) that the right people are able to get your STUFF in the event of your death.

Every estate planning tool fits into one of those two categories, and a good estate plan should address both areas of focus.

And as luck would have it, I will be discussing both categories in this post.

What's the Difference Between a Will and a Living Will?
Estate Planning
David Postic
3 Magic Ingredients in a Great Letter of ...

So you’ve got some nifty estate planning documents?

You are awesome.

Formal estate planning document can ensure your family is cared for after your death, avoid court, and minimize the burden your loved ones will face when you are gone.

But legal documents are only one part of the equation.

Your estate plan is not complete just because you signed some fancy papers.

Because while formal estate planning documents can avoid legal obstacles after your death, they do not eliminate the myriad other tasks necessary to settle your affairs.

Think of it this way:

If you died today, would your family know what to do?

If they couldn’t remember anything you told them about your estate, would they be able to easily find all the information they need?

Read more: Why You Need to Have an Estate Planning Fire Drill

If you answered “no” to either of those questions, then your estate plan is not complete.

To make things easier on your loved ones after your death, the best thing you can do is create an estate planning letter of instruction.

3 Magic Ingredients in a Great Letter of Instruction

Taxes

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Everything You Wanted To Know About Estate & Gift Taxes

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Everything You Wanted To Know About Estate & Gift Taxes

The Internal Revenue Service (IRS) recently announced that the estate and gift tax exemption is increasing in 2024 to $13.61 million per person, up from $12.92 million in 2023.

The IRS also confirmed that the annual gift exclusion amount is increasing from $17,000 per person in 2023 to $18,000 per person in 2024.

Read more: IRS Rev. Proc. 2023-34

Okay great, you might be saying to yourself. But what does that mean, and why does it matter?

Great questions.

There are a lot of misconceptions about estate taxes and gift taxes — often referred to as “death taxes.” What they are, who has to pay them, how to avoid them.

This article is my attempt to demystify the topic for you and to help you figure out how these tax changes could affect your estate plan.

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IRS Increases 2020 Estate Tax Exemption

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IRS Increases 2020 Estate Tax Exemption

The Internal Revenue Service (IRS) just announced that the estate and gift tax exemption for 2020 is increasing to $11.58 million per person — up from $11.40 million in 2019.

If you are like most people, you are probably asking, “What does that actually mean?”

What is the Estate & Gift Tax Exemption?

As I explained in the summary of estate and gift taxes I wrote last year:

The estate tax is a federal tax imposed on estates over a certain value. That “certain value” is known as the “estate tax exemption” or “combined estate and gift tax exemption” or “unified credit” or a dozen other names.

The main thing to know is this: if an estate is worth more than the estate tax exemption amount, the value over the exemption will be taxed. If the estate is worth less than the exemption amount, no tax liability.

So the increase announced yesterday by the IRS means that if an estate is created (i.e., if a person dies) in 2020, there will be no estate tax imposed if the estate is worth less than $11.58 million. And thanks to estate tax portability, a married couple can now shield double that amount, $23.16 million, from estate taxes in 2020.

This is How Much You Will Pay in Taxes in 2019

This is How Much You Will Pay in Taxes in 2019

Interesting fact: many tax provisions are indexed for inflation.

Okay, I may have a loose definition of “interesting.” But the fact is still true. And inflation indexing is actually a really important thing when it comes to taxes.

The Internal Revenue Service (IRS) recently made several announcements regarding the 2019 tax year, including the updated estate and gift tax exemption.

Also included in the announcements were annual inflation adjustments for over 60 tax code provisions for 2019: tax rate schedules, standard deductions, cost-of-living adjustments, and more.

In the spirit of Christmas, I thought I would explain what these inflation announcements are and what they mean to you. After all, nothing says “Merry Christmas” like taxes.

Important note: Keep in mind that the numbers discussed in this post are for the tax year beginning January 1, 2019. These are not the numbers you will use to prepare your 2018 tax returns which will be filed in April 2019 (you can find that information here). This is the information you will need for your 2019 tax returns in 2020.**

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Do I Need to Pay Inheritance Taxes?

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Do I Need to Pay Inheritance Taxes?

Do you want to pay less in taxes?

Of course you do. I would be worried if you wanted to pay more in taxes...

The question is HOW you can pay less in taxes. Here's one way: estate planning.

A good estate plan can help you minimize your tax burden. Specifically, estate planning can impact (1) income taxes, (2) inheritance taxes, and (3) estate taxes.

Most people are familiar with income taxes. However, they are less familiar with estate taxes; and many people have no idea that inheritance taxes even exist. So it comes as no surprise that one of the most common questions I get from prospective clients is:

"Do I need to pay inheritance taxes?"

It is a good question and is usually accompanied by a number of other, related questions:

  • What, exactly, is an inheritance tax?

  • Is an inheritance tax the same thing as an estate tax?

  • How can I avoid having to pay an inheritance tax?

This blog post will answer these questions, give you a better understanding of the difference between inheritance taxes and estate taxes, and explain how those laws operate in Oklahoma.

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What Is Stepped-Up Basis?

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What Is Stepped-Up Basis?

Nobody likes taxes.

And even though the federal estate tax is not a problem for most people anymore, there is another tax that could drain your estate and reduce what your loved ones receive after your death.

The good news?

By creating a solid estate plan, you dramatically reduce (if not eliminate) the need for your heirs to pay these taxes after your death.

That’s what this post is about: How to legally avoid having to pay taxes.

Related post: IRS Increases 2020 Estate Tax Exemption

[A brief disclaimer before diving in. I will be discussing this issue only at a very basic level and only in the context of estate planning. I am not a tax professional, and nothing in this article should be construed as tax advice. Consult a certified tax professional for all tax-related questions.]

Capital Gains Tax: Explained

America has a type of tax called the capital gains tax which says if you sell a capital asset (e.g., a house, shares of stock, etc.) for more than you paid to buy it, you may be taxed on the difference.

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