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Eight New Year’s Estate Planning Resolutions

Annie Rogers

Christina Knopke

Eat better, exercise more… and do some estate planning? Attorneys Chrissy Knopke and Annie Rogers make the case for taking eight actions in 2022 – from executing and funding your trust to reviewing your beneficiaries – to at least get your estate plan, if not your body, into shape.

Listen to some more reasons to call your estate attorney: https://creativeplanning.com/podcast/reasons-to-call-your-estate-planning-attorney/

Learn the difference between a revocable and an irrevocable trust: https://creativeplanning.com/podcast/revocable-trusts-vs-irrevocable-trusts/

A Matter of Trust, hosted by Creative Planning Attorneys Annie Rogers and Christina Knopke, is a thoughtful, informed discussion about ideas, trends and developments in estate planning. Our mission is to educate and inspire people to make better financial choices through knowledge, tools and strategies that ensure a more prosperous future.

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Chrissy Knopke: Welcome to Creative Planning’s A Matter of Trust. This is Chrissy Knopke, and I’m here with my friend and colleague, Annie Rogers. We’re both attorneys here at Creative Planning. And today, we are going to talk about the top eight new year’s resolutions in estate planning. So Annie’s going to lead us out with the first one.

Annie Rogers: The first resolution is to resolve to put an estate plan in place, if you don’t already have one. Clearly, this is important. If you haven’t done this yet, it’s a good time to get that started and make sure you have your wishes documented.

Chrissy: So, we have many clients — on to number two — that have created an estate plan. They have drafts of an estate plan, yet they still haven’t signed their estate plan in front of a notary and two witnesses, so they’re not in effect. So number two is to actually sign and execute a plan, if you have one but have not put it in place yet.

Annie: Because, just to remind you, if they aren’t signed, it’s as if you don’t have a plan at all. The third is to review your existing documents, and make sure there are no changes needed for who you want receiving your assets, have there been any law changes that affect your plan, just kind of doing a…

Chrissy: A quick review, just to see if there’s any updates needed. That goes along with number four, which is to review all of your accompanying documents. So, your healthcare power of attorney, your financial power of attorney, guardians of your minor children, make sure those are all still the same people that you would want (that when you put them in place) today. So a lot of times that changes. 10 years ago, you might have wanted one person, and that relationship or something has changed, and you’d want somebody else to be doing that job for you.

Annie: The next thing that is really important is, if you have established a trust, to make sure it’s funded. Because, the trust is like a bucket, and if you haven’t pointed things back to it, you’re going to be back to probate, and it kind of defeats the purpose of having set up the trust. So, it’s always good to, every once in a while, kind of look through all your assets and make sure you have correct beneficiary designations and have your assets titled correctly.

Chrissy: I always say, if you bought a trust but never put assets in it, you just bought really expensive paper that’s going to do nothing for you. So, that’s really a big one there. Which on to number six, always consider drafting a letter of guidance or instructions to the person you’ve put in charge. It can list anything from what you might want them to distribute assets to your children for, where you might want your kiddos to go to school if something happened while they were younger. So, this can contain a lot of things. And although it’s not a legally binding document, it gives your agents some direction of what you would’ve done in that exact same scenario.

Annie: Yeah. And it helps them make sure that your wishes are fulfilled. The next one is to resolve to make sure your fiduciaries know where you keep your documents. They can’t use them if they don’t have a copy of them. So, if you have your binder of documents, and you have them in your office, just make sure that somebody knows where they are and how to get to them. If they’re in a safe, somebody needs to know how to get into the safe.

Chrissy: And if you’re comfortable, at this point, you could even send them copies of those documents. So if something happens when you’re very sick and it’s the middle of the night, they don’t have to go to your house and get the documents, they already have a copy.

Annie: Or make sure they know who to contact to get a copy.

Chrissy: Last and final point is, do you need to file a gift tax return for 2021? So, if you gifted any one person more than $15,000 as a single person or $30,000 as a married couple, you would need to file a gift tax return for that amount, over the gift that you gave. And, Annie wants to tell you what the new annual exclusion amounts are.

Annie: So, it went up this year. Every once in a while, it rises with inflation. So this year, it’s $16,000. So, you can give any individual $16,000, or a couple can give $32,000, collectively, without having to file a gift tax return. And then, the estate tax exemption also went up. It rose with inflation. And so, for 2022, it is $12,060,000. So, just over $12 million is what you can leave for 2022. And, we’ll keep our eye on that. That may change in the future. And obviously, if that happens, we’ll let you know.

Chrissy: So we hope you resolve to look at these top eight things that you may need to do throughout the year for estate planning. And it kicks your year off right.

Annie: Happy new year.

Chrissy: Thanks for joining us.

Disclosure: This commentary is provided for general information purposes only, and should not be construed as investment, tax or legal advice. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable, but is not guaranteed. This commentary and the information provided may be considered advertising in some jurisdictions, under the applicable law and ethical rules. The determination of the need for legal services and the choice of a lawyer are extremely important decisions and should not be based solely upon advertisements or self-proclaimed expertise. No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers.

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