Atlanta Estate Planning Attorney Asks: Do You Know How to Manage Your Inheritance?

Atlanta Estate Planning Attorney Asks: Do You Know How to Manage Your Inheritance?

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Receiving an inheritance is both an honor and a responsibility, and Atlanta estate planning attorneys constantly see individuals who are just not ready to take that on appropriately. Unlike items of sentimental value, such as jewelry or family heirlooms, a financial inheritance was likely meant to be used toward your own monetary goals. The temptation to simply spend away an inheritance as “bonus” money can be strong, but there are a whole lot of very practical means by which to manage the funds for your own future.

When you receive an inheritance, you should look at how it fits into your overall financial plan. Are you saving for a particular purchase, working toward paying off debt, or building a retirement fund for yourself? These are all potential uses for the money which has been left to you.  You should also be aware that inheriting the funds may have tax implications. Your Atlanta estate planning attorney will be able to guide you when it comes to ways of reinvesting or living off of the inheritance in order to minimize the amount of taxes you will need to pay.

The types of inheritance you receive can certainly vary, with stocks, bonds, bank accounts, and insurance benefits all being possibilities. The different types of sources and dispersal of funds may be governed by certain rules or laws. For example, many people are surprised when their Atlanta trusts and estates attorney tells them they can have a limited amount of time to withdraw funds from an inherited retirement account, like a 401(k), 403 (b), or and IRA. The rules and regulations won’t be the same for every type of account, but if you don’t find out what they are, you can end up paying a lot of penalties and fines out of the money you’ve inherited.

There may also be times when you feel you don’t need the money as much as another beneficiary and are willing to forego your share. This might be for altruistic reasons or simply to protect your own tax situation.  In this case, you can work with your Atlanta estate planning attorney to properly disclaim your inheritance. Doing something along these lines can allow the money to “flow” through you and to another beneficiary, possibly even one of your own children.

When it comes to managing your inheritance, there can be many complications to work through, and one of the best ways to minimize confusion is to work with a qualified and experienced Atlanta estates attorney. Remember, the type of inheritance, your future goals, your tax situation, and even whether or not you “need” the inheritance will all come into play when determining what is the best route for you to take.

Our attorneys are ready to answer your questions and assist you with the implementation of your financial goals. To schedule a complimentary Georgia Family Treasures Planning Session with the mention of this article, simply call our office at 770-425-6060 or email us at steve@georgiafamilylaw.com.

Estate Planning for College Graduates in Georgia

Estate Planning for College Graduates in Georgia

Estate Planning for College Graduates in GeorgiaBy the time you earn your college degree, you may not feel like you have anything to “protect” through estate planning.  After all, the stereotype of the “starving college student” got started for a reason!  But, even if you leave college with a load of student loans and an entry-level job (or hopes of one), you will do yourself a favor by spending just a little time doing some basic estate planning here in Marietta and Cobb County, Georgia.

Marietta GA Estate Planning for Your Physical Self

There are tons of reasons to do your estate planning, and it seems like those most often talked about are passing on your possessions and avoiding taxes.  It can be argued, however, that there is a far more important reason, and it’s one that even young college graduates shouldn’t overlook: your medical decisions.

What happens if you become injured or otherwise capacitated and can’t tell the doctors what you want?  Who makes decisions for you about what kind of life-sustaining measures should be taken or whether or not you consent to surgery?  In most states, an individual’s parents are given this responsibility (although that is not always the case).  Whether you want your parents in that role or someone else, the way to make sure you have a say is to have an estate planning lawyer in Marietta Georgia draw up a legally binding “medical power of attorney.”

Marietta  Estate Planning for Your Finances

It may not seem like you have much of anything to look after when it comes to finances and the recent college grad.  In reality, though, you likely do have some things to consider.  For example, do you have any debt, and if so, do you know what happens to it if you become incapacitated or pass away?  The answer has a lot of variables such as the kind of debt, whether or not you have other authorized users on your account, and more.

One of the reasons you worked so hard for your degree was likely so you could move out into the workforce, and with that comes options such as retirement accounts and insurance.  Each of these includes naming a beneficiary for benefits, and you’ll want to make sure you are up to speed on what it means and have the appropriate people named.  Some accounts don’t have specific beneficiaries, so setting up even a simple will can help make the transfer of those funds much easier and less expensive when the time comes.

Marietta Georgia Estate Planning for Your Partner

Many college graduates are moving forward with their lives as couples, both married and unmarried.  Either way, estate planning in Marietta and Cobb County GA  is an important part of making sure that your partner is cared for and receives the appropriate benefits upon your death. As mentioned above, you want to make sure you have the correct information filled out when it comes to beneficiaries on accounts, but you will probably want to go a step further to ensure that your assets pass in the way you want.  Typically, an unmarried partner is not entitled to the same benefits as spouses, so if you don’t set up the situation appropriately through well-reasoned estate planning, your significant other might be entitled to absolutely nothing!

Estate Planning Matters For College Grads, Too!

Contrary to what you may have heard, estate planning is NOT just for the ultra-wealthy or the elderly.  Estate planning is just as important for the college grad and savvy young adult, too.   Celebrate your recent graduation and your success by getting a complimentary review of your situation. Schedule a Georgia Family Treasures Planning Session with the mention of this article and let us help you layout a road map for lasting protection and peace of mind in the future.

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Handling The Tax That Won’t Die, Even If You Do

With all the talk about the future of the Bush tax cuts, one aspect of taxation that isn’t getting quite as much press is the reappearance of the estate tax.

As of January 1, 2011, the estate tax will once again rear its ugly head and take a serious bite out of your estate when it does. 

If your estate is valued at $1 million or more (for individuals, not married couples), you can expect your heirs to be hit with a tax bill of 55%.

Here’s a quick and dirty list of things you need to seriously think about before January 1st:

1.    Don’t Count On Congress.

The issue of the estate tax may not be resolved any time soon.  The Bush tax-cut extension is such a hot button issue and is generating so much press, no one is sure what will result from it.  An increase of the estate tax exemption to $5 million is included in the Obama tax plan, but the House and Senate would both have to agree to it for that to become law. The end of the year is only about 3 weeks away and there’s still a lot of squabbling on Capitol Hill about this issue. 

2.    Plan For The Worst Tax Rate.

Plan your estate based on the worst case scenario.  The smart money is on some change in the estate tax for 2011, possibly going back to the 2009 individual exemption and tax rate, but no one really knows what will happen.  With the government facing a serious budget crisis, it is highly unlikely that the tax will be repealed and eliminated.  No one in government is going to let go of that kind of revenue.

3.    Take Advantage Of Every Possible Loophole.

If you or a loved one is critically ill, talk to your estate attorney now.  Ask about the possibility of annual gifts of cash (up to $13,000 tax free), securities, property, medical care payments, or even tuition, before year end.  If your assets are still at issue, ask about generation-skipping trusts or the formation of other trusts.  It may cost you some in taxes but gift tax rates this year are 35%.  They will probably never be that low again. 

4.    Talk To Your Lawyer Now.

Any of the potential changes in the estate tax can have an adverse effect on your estate and the future of your heirs.  And none of the options to handle the tax can take place overnight.  Talk to your attorney as soon as possible to get your plan in place.

You can’t “wait until after the holidays” to deal with these tax issues.  It can take weeks to transfer accounts or securities or even gifts.  Talk to us now to get things rolling and make sure your bases are covered, regardless of what Congress does or doesn’t do.    

Call us, your Marietta estate planning lawyers, to schedule your Georgia Family Treasures Planning Session today.  We can advise you about the steps you need to take now to protect your estate and continue to advise you when Congress finally on the future of the estate tax.

A Georgia Family Treasures Planning Session normally costs $750, but this month I’ve made space for the next four people who call us before December 31 and mention this article to have a complete planning session with me at no charge.  Call today and mention this article.