Individuals who plan their own estates are more likely to make mistakes that impact their loved ones and their family’s ability to carry out their final wishes. Fortunately, many of these mistakes are easy to avoid once you know what they are.
Keep reading to learn the five most common estate planning mistakes and how an estate planning attorney can help with this challenging process.
1. Not Updating Your Estate Plan to Account for Births and Deaths
People commonly treat their estate plan as a one-time process and fail to update it when there’s a change in the family structure — such as a birth, death, marriage, or divorce. Periodically updating your estate-related documents will ensure your beneficiaries receive what you designate for them, regardless of changing family dynamics.
2. Not Planning for an Unexpected Disability
Unexpected illnesses, injuries, or disabilities can have a major impact on your finances. Your estate plan should include provisions for your care in the event you need long-term care and are unable to monitor your finances or estate. This includes naming guardians for your children, granting power of attorney to a trusted friend, family member, or third-party professional, and ensuring someone is appointed to handle your financial affairs and maintain your property.
3. Not Making Gifts
Each spouse can make a financial gift of up to $14,000 that is excluded from the estate tax. Donations to groups, organizations, businesses, or individuals are considered “gifts” under this provision. Paying for someone’s tuition or medical expenses, gifts to your spouse, or gifts to political organizations are also considered non-taxable gifts. Any donations to charitable organizations are also tax-exempt.
4. Not Passing Property on as Inheritance
You can ensure your children or other beneficiaries come into possession of your property by placing their name on the title or deed. However, if the value of the property is greater than $14,000, it is subject to tax. Avoid saddling your loved ones with this financial burden by transferring the property via inheritance instead.
5. Making an Incomplete Estate Plan (or Not Making One at All)
The worst mistake you can make in your estate planning is not planning at all. It’s natural to want to put this off, but failing to create a comprehensive plan can leave your loved ones in a difficult position.
In Michigan, inheritance laws include provisions for how property is transferred after your death. These laws are designed to interpret how individuals would want their family, finances, and property cared for and distributed in their absence, but it’s a complicated and subjective process. The best way to ensure your last wishes are carried out to the letter is to create a thoughtful and thorough estate plan.
An Estate Planning Lawyer Takes the Pressure Off You and Your Family
We know thinking about life after you’re gone is uncomfortable, but it’s in your best interests to protect your assets and ensure that the people you love receive what you want them to after you pass. An estate planning lawyer can simplify the process of creating a comprehensive estate plan so your last wishes are carried out the way you intend.
Contact the Law Offices of Kari Santana for Help Planning Your Estate in Michigan
At the Law Offices of Kari Santana, we believe you need an estate plan that’s as unique as you are. Our experienced estate planning lawyers are prepared to help you evaluate your situation and make the best plan for your future and your family. We listen to your story to create custom-tailored solutions that give you confidence and peace of mind.
To get started today with a free initial consultation, please call us at (616) 717-5759 or complete this brief online form.
References
Frequently Asked Questions on Gift Taxes. Internal Revenue Service. Retrieved from https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes#2
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.