New Jersey residents interested in estate planning issues may wish to know why their current documents may be obsolete. Because circumstances and law are subject to change, the older documents may no longer have the effect that they once did.
Wills and other complicated estate planning documents should be revisited periodically to ensure that they still comply with updated laws and new family situations, such as marriages, divorces and new children. There are some specific changes in the law over the years that, if an estate plan predates them, there may be issues. Most of these have to do with changes in laws, which could have serious tax implications. For instance, in the beginning of 2005, states began to implement their own state-level estate taxes. An estate plan created before these state tax laws may expose the estate to unnecessary tax exposure.
Other tax law changes include a federal estate tax exclusion increase in December 2010, which could render prior tax planning unnecessary. Furthermore, a 2013 provision allows spouses to take advantage of their deceased spouse's remaining exclusion. Failure to take these into account could mean that important opportunities to minimize taxes could be lost.
Another important change, which can seriously affect the power of attorney documents in an estate plan, took place in April 2003. Without specific language in these documents, the person given power of attorney may not be able to perform their duties.
Understanding a person's estate planning needs may be difficult without the assistance of an attorney. The attorney may be helpful in revisiting older documents to ensure that they are current or drafting a new estate plan based on current goals.