Under the new federal estate tax law, individuals with estates valued at $5.25 million or above are subject to the tax. This amount is equal to $10.5 million for a married couple. Despite the fact that this greatly reduces the number of estates that face an estate tax problem, many attorneys are stressing the fact that an estate plan is still a necessary and important aspect of life for nearly everyone.
Even without an estate tax issue, there are many valid reasons for putting together an estate plan in California. For example, a recent article published in the New York Times points out the fact that many people tend to forget to go back and change their beneficiary designations on insurance policies and retirement accounts, even after life circumstances change. In addition, families with young children should have a Will that appoints the guardian of their children, should something happen to them.
Families with children who have spending issues or substance abuse problems could also benefit from setting up an estate plan. These families may be able to create a trust that can protect some or all of the assets while still benefiting the troubled child. This may also apply to people who are concerned about the stability of the marriages of their children.
Furthermore, it is important to note that in California, even having a Will does not prevent you from needing the state to be involved with the estate administration process. A Will must be approved by the probate court. To get around this, many clients set up living trusts to avoid the need for a formal probate proceeding upon their passing.
Clearly, even with the passing of the American Taxpayer Relief Act in January, there are many reasons for setting up an estate plan. Contact the experienced Orange County estate planning attorneys at the Law Office of James F. Roberts & Associates, APC for more information and guidance. Call our office today at (714) 459-5481.