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Lessons to be learned about estate planning

| Dec 22, 2017 | Estate Planning |

Many New Jersey residents are aware of the new tax bill that was passed by Congress and signed by President Trump. Kristi Noem, who is a Republican congresswoman from South Dakota, has campaigned for a repeal of the estate tax based on her family’s story.

According to Noem, her father was killed when he was still relatively young in a farming accident. He had amassed 10,000 acres of land but had relatively little cash when he died. Noem was 22 at the time of her father’s death and has repeatedly told the story of how she had to move home and work to save the family’s farm because of the high estate tax bill that was assessed by the Internal Revenue Service.

Estate planning experts state that the family could have avoided estate tax liability if Noem’s father had updated his will. He wrote a will in 1976 but did not update it from 1981 to 1994. If he had, his family could have taken advantage of the spousal exemption, which would have meant that they could have avoided the estate taxes.

It is important for people to have estate plans in place so that their assets can be passed to their loved ones according to their wishes. Estate plans may also help families to avoid potential tax liability. However, the laws frequently change. People should not draft estate plans and then simply put them aside. When changes occur, the documents should be reviewed and modified as needed. People might want to meet with their estate planning lawyers every few years to go over their estate plans. They might also want to meet with their lawyers any time they experience major life changes, including new marriages, new children, divorces, deaths and remarriages. This might help people to prevent unwanted results from happening.