Partners Marci Cohen and Steven Gallant talk about the importance of proper estate planning and the benefit of having a trust. They also discuss the importance of planning ahead to ensure that all of your assets are handled according to your wishes.
Transcription for the Video
(Steven Gallant) Hi, I’m Steve. I’m a tax partner at LGA and this is my partner Marci. Today our topic is going to be estate planning. Do we really need the estate planning? Clients come in all the time and say, what’s this all about? Why do I need it?
(Marci Cohen) Well, you know that the estate tax exemption has been raised to $11 million and a lot of people think, why do I need that? Well, the truth is, here in Massachusetts, the gross assets are if they have more than 1 million, you have to file an estate tax return. So, estate planning is really important to ensure that all of your assets are disposed of and within your wishes.
(Steven Gallant) What if I die without a will?
(Marci Cohen) Okay well, a will is a really important document. If you die without a will, your assets have to go what they call probate. And that the courts decide how your assets, how should be disposed of. A will is important that you have a will to designate where you want your assets to go at the time of your passing and to ensure that your beneficiaries get the assets that you want them to have. It’s also important to review your beneficiary designations along the way so that you can review your insurance policies, your retirement plans, maybe prenuptial agreements to ensure that they also go to the right beneficiaries. We talked a lot about trust and people say, why do I need a trust? I don’t have that much money. And the truth is a trust is a great vehicle to not only help you plan possibly down the road for the payment of those estate taxes, but the most common type of trust is a living trust or a revocable trust that you have while you’re alive. You could attribute assets to that trust, and you can move assets in and out of that trust while you’re still living. So, you can use them for your own pleasure. You can assign new beneficiaries and that trust is a great vehicle to hold those assets on behalf of your beneficiaries.
(Steven Gallant) And, and please don’t feel like you’re alone in this game. People feel, don’t want to talk about death. That’s why they come to us and talk about it. We’re here to help you out and to plan this out and make it, painless.
(Marci Cohen) It’s true and it’s also important as the trustee. Just as one last note, as the trustee, you want to make sure that you ensure that all the decedent’s final tax returns are filed. It’s an important role. Could be your final 10 40. It could be the trust return or maybe even a gift tax return for lifetime gifts made along during a calendar year. So it’s important.
(Steven Gallant) And we’re here to help you.
(Marci Cohen) Well, we hope to hear from you at LGA we can help you through the very difficult estate planning process.