Page 13 - Means Wealth 2020/2021 Perspectives
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typically considers any property acquired during a marriage to be the
              property of both spouses. Some states also impose a form of estate
              or inheritance tax. Each state has different exemption amounts. It is a
              good idea to know where your state stands on these issues. You may
              need to update your estate plan if you change residency.
           6.  Through the Tax Cuts and Jobs Act passed in 2017, one thing that was
              preserved is estate tax portability.  The unused portion of the marital
              exclusion amount (currently at $11.58 million Federally in 2020 and
              moving to $11.7 million Federally in 2021) may now be transferred to
              the surviving spouse provided that a federal estate tax return is filed to
              preserve the deceased spouse’s unused applicable exclusion amount
              within 9 months, or 15 months if an extension is granted.  Essentially,
              this gives you double the amount ($23.16 million for 2020 and $23.4
              million for 2021) free from Federal estate taxes—upon the death of one
              spouse—if used properly.
           7.  Continue to be philanthropic. Never forget that philanthropy is a
              positive for society, the charity you support and for the donors’ family.
              Remember to include the charities that you are passionate about in
              your estate plan. You can consider direct gifts, charitable trusts, donor
              advised funds and family foundations.
           8.  Remember that income tax rates have increased relative to estate
              tax rates. Changes in the federal tax law make it increasingly
              important to focus on the income tax consequences of estate
              planning in addition to the estate tax consequences. It is worth
              noting that trusts are taxed at the highest federal income tax bracket
              (37%) if there is $12,950 of income.
           9.  Make sure existing life insurance policies make sense from an estate
              planning and financial perspective. Proceeds pass directly to a
              beneficiary unless your estate is the beneficiary.
          10.  Keep your loved ones informed. Consider drafting and regularly
              updating a letter of instruction to your fiduciaries and children.  The
              letter should include an inventory of assets and the location of each
              asset, such as in the safety deposit box, as well as a list containing
              names, addresses and phone numbers of your estate planning team.
              Make sure to give your fiduciaries the appropriate power to handle
              your assets. Make sure your power of attorney and will give your
              fiduciaries the access they need to access these accounts. n

                     Adapted from Fidelity’s “10 estate plan pitfalls to avoid”

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