All About Inheritance

Posted by on Apr 20, 2023 in Legal News |

As you can guess from the title, this article is all about inheritance. Chances are, if you have received an inheritance (or if you will be getting one in the future), you have a few questions about how the process works. In this article, we’ll discuss the ins and outs of this common estate planning question.vacation

What Is An Inheritance?

Giving and receiving an inheritance has been going on for centuries. It is the practice of receiving titles, debts, privileges, rights, obligations, and private property when an individual dies. The rules of inheritance have changed vastly over time, and they differ from society to society. What we consider inheritance here might not be the same in China, India, or Africa.

Examples of inheritance include bequeathments such as cash, investments (bonds, stocks, etc.), cars, antiques, art, real estate, jewelry, and more. The value can range from the hundreds to the millions, and, in most countries, inherited assets are taxed. An inheritance tax is often nicknamed “the death duty,” or, more colloquially, “the last twist of a taxman’s knife.”

Currently, there are six American states that have inheritance taxes: Iowa, Nebraska, Maryland, Kentucky, Pennsylvania, and New Jersey. In most of these states, assets bequeathed to a spouse cannot be taxed. And, in some cases, kids are exempt from these taxes. But, if you don’t fit under one of those exceptions, be prepared to get taxed.

What Does Florida Say?

Florida does not have an inheritance tax, nor does it have a gift tax. It also got rid of its estate tax in 2004, and this lenient taxation is why a lot of people move down to the Sunshine State. That said, other states’ inheritance taxes might still apply to you, even if you live in Florida. If the deceased lived in Pennsylvania, for example, and he or she bequeathed something to you, P.A. tax laws would govern. This means that you need to check the laws of the state in which the deceased lived to determine taxation.

As far as the gift tax goes, though Florida does not have it, the federal government certainly does. The federal tax exemption is $17,000 for 2023, and your lifetime exemption is $12.92 million. Remember, you are subject to both state and federal laws.

What A Trust Can Do For You

A trust is a useful tool when it comes to inheritances. If you are expecting an inheritance from someone (or if you are planning to leave one), setting up a trust to deal with these assets is a very good idea. For one, it allows you to pass assets to your beneficiaries without having to deal with probate court. Trusts are a lot like wills, except they avoid state probate requirements, a helpful feature that cuts down on their court expenses.

Below are some of the benefits of trusts:

· A trust protects heirs from your creditors.

· A trust will avoid probate (as aforementioned).

· A trust will give you control of the asset, depending on the type you set up.

· Assets are able to stay in a trust for several generations.

Benefits aside, trusts are not for everyone, and they do come with their disadvantages, such as their costs (this is especially true for a revocable trust). While trusts don’t have the expenses of probate court, making them revocable (and therefore more controllable) can have negative consequences as far as estate duty, stamp duty, and asset protection go.

If this all sounds confusing, don’t worry. When it comes to questions of inheritance, no matter whether you’re bequeathing or receiving, a WFP estate planning attorney can help you. A trust needs to follow certain rules in Florida, and a lawyer will be able to ensure that you dot your Is and cross your Ts when forming one.

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When Is The Right Time To Set Up Your Estate Plan?

Posted by on Apr 13, 2023 in Legal News |

When it comes to estate planning, there is no time like the present (so long as you’re a legal adult). According to financial experts, the best time to make an estate plan is when you are of legal age at eighteen years old. That said, a lot of eighteen-year-olds haven’t thought twice about heading off to a lawyer’s office to set up an estate plan.

It makes sense, as these teens usually don’t have many assets, and they are often confused about the purpose of estate planning. Most people think of a last will and testament when they think of estate planning, not realizing that there is so much more to it. Let us, in this article, try to convince you to set up an estate plan, no matter what assets you do or don’t have.

What If I Have No Assets?

If you’re low on cash and other assets, don’t worry—so are a lot of Americans. As of 2023, 60% of Americans, including 40% of high-income consumers, live paycheck to paycheck. With the rising cost of living, that’s just how things are for many people.

Estate planning is about so much more than bequeathing assets (though that is an important part, of course). You can use it to set up guardianship papers, manage end-of-life healthcare, and set up a financial decision-maker if you become too incapacitated to handle your own affairs. It doesn’t matter what assets you do or don’t have—this legal field can help anyone.

Other Times to Set Up an Estate Plan

There are plenty of other times to set up an estate plan. Here are some prime opportunities you don’t want to miss:

· New Family Members. If you have kids or grandkids entering the family, that could be a good time to set up an estate plan.

· Savings Accounts. You’ll want to determine who will get your savings account if you die—that’s a good time to start an estate plan.

· Property Ownership. When you buy a home or land, that is a major asset to consider.

· Marriage. Getting married means that you are combining your assets.

· Traveling. If you’re going on a big trip, it is important to ensure you have healthcare directives, guardianship papers, and more set up.

· Inheritance. If you inherit something, that is a major asset that needs to be secured.

· Starting A Business. Estate planning can help you secure your business’ future and protect your assets.

Additionally, it is important to set up guardianship after you have a child, as you want to make sure your chosen guardian is there to step up if something happens. When

you amass more assets, it could be a good idea to then start a trust, which will move some of them into safe keeping for your future beneficiaries.

When To Update Your Estate Plan

So, you’ve made an estate plan, now what? The rule of thumb states that you should go back and update and review it every three to five years. You can go back earlier if you experience a major life change, such as marriage, divorce, new births, new assets, and more. It’s important to keep your estate plan up to date, lest something happen and yours does not reflect your current situation.

There are a lot of milestones and markers when it comes to estate planning, and you should set one up, if you haven’t. Contact a WFP attorney today and explain your financial situation. He or she will be able to help you determine which estate planning tools and documents are right for you.

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How To Be Less Stressed During Stress Awareness Month.

Posted by on Apr 10, 2023 in Legal News |

We’ve all experienced stress at some point in our lives, and it might help you to know that April is National Stress Awareness Month. This month brings attention to not only the negative psychological impacts of stress, but the harmful physical impacts as well. Knowing how to manage your stress levels will help you live longer and healthier. 

So, what are Americans so stressed about? Luckily, there have been quite a few studies on the causes of stress among the U.S. population. Firstly, according to the American Psychological Association, 44% of Americans say they experience “moderate to high” levels of stress on a daily basis.

NBC News found that 87% of those surveyed who reported stress cited, as of 2022, the rising cost in living. As we all know, the costs of everything from groceries to gas is higher, and it’s no wonder that we are, as the news outlet put it, “besieged by stress.”

Dealing With Financial Stress

These are trying times, to say the least, and you can deal with financial stress through smart planning, consulting with financial professionals (if possible), and talking to lenders. The symptoms of financial stress include:

· Difficulty sleeping

· Feeling fearful

· “Snapping” and getting angry more quickly than usual

· Arguing with loved ones about money

· Withdrawing from other people

If you are experiencing these symptoms, it is important to talk to someone, as you are not alone. Literally, millions of Americans are going through the same thing. According to Bankrate, you can manage financial stress by:

· Prioritizing what you can control

· Accepting what you cannot control

· Finding secondary streams of income

· Paying essential bills first

· Saving money, if possible (even $10 a month still counts!)

· Tracking your progress in bill-paying

· Having an honest discussion with lenders (don’t just ignore them)

· Being open with loved ones about your financial situation

In addition to these helpful techniques to manage stress, you can also consider estate planning. Though estate planning does involve its own expenses, it is actually one of your best allies in the fight against financial stress.

Estate Planning: How It Helps Financial Stress

Estate planning is a way to determine how your assets will be distributed after you die. There are other essential tools to estate planning too, including documents that manage guardianship, healthcare decisions, protection of assets, and more. Here are some of the ways that estate planning aids in the fight against financial stress:

· You can legally minimize gift, income, and estate taxes

· You can avoid probate court

· Feel in control of your future

· Your assets will go to the right people

· You can plan for end-of-life healthcare

· You can plan for future financial investments and trusts

As you can see, there is a lot of mention of the “future” in estate planning. Most of us are worried about the future—will prices keep rising? What if something bad happens and we can’t cover the expense? The beauty of estate planning is that it helps you get your financial affairs in order, providing a sense of stability and security. Though it is not a cure-all, we all know that every strategy helps in the fight against financial panic.

Hopefully, what you took from this article, in addition to the fact that estate planning can help you breathe easier, is that you are not alone. Everyone is anxiously checking their bank accounts, wincing when they see bills, and having tough conversations with creditors. We’re going through a rough time right now, but, as with every single other rough time in American history, we’re going to get through it together. 

Contact a WFP estate planning attorney today to learn how estate planning can help prepare you for the future.

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