Now that the estate tax exemption has been doubled, some people are saying there is no longer a need for estate planning. However, estate plans have never been mostly about avoiding the estate tax.
For people who do not want to take the time to plan for their own estates, it might seem like 2018 has started out to be a good year. It has been so good that some people are talking about the death of estate planning itself, because the federal estate and gift tax exemptions have been doubled. They also think that there is no need to have plans to avoid those taxes.
However, most people who planned for their estates before this year were not subject to the federal estate tax anyway, because there have always been other reasons to make an estate plan. Those other reasons still exist.
Recently, Kiplinger discussed some of those reasons in "Is Estate Planning Now Dead?"{: target="_blank"} including:
- A few states still have estate and inheritance taxes of their own. Some of them have lower thresholds than the federal exemption limit. People in those states might need to plan around those taxes.
- In many states, probate is a very expensive and time-consuming process, giving people good reasons to get an estate plan that avoids probate completely.
- Estate planning is also a good way to avoid any particular issues that might come up with an unplanned estate. For example, if any heirs have potential problems, like financial or drug issues, estate planning can help make sure that any inheritance is not wasted.
- Estate planning is also the best way to avoid fights between family members over who should get what from the estate.
Contact a qualified estate planning attorney to get your affairs in order without delay.
Reference: Kiplinger (May 1, 2018) "Is Estate Planning Now Dead?"{: target="_blank"}