Understanding the need to update an estate plan

On Behalf of | May 6, 2015 | Estate Planning

Las Vegas residents who have not updated their estate plan may wish to know why their plan may have issues now. Due to changes in the law, lacking a current estate plan could lead to higher estate taxes and other legal issues.

In the time that passes since creating an estate plan, the person’s family or asset situation may have changed or tax and other laws may be drastically different. Failure to update a will and other documents could cause issues due to these changed circumstances. One expert says that people should check to see if their estate plans were created before certain dates. The first is April 14, 2003, the day that the HIPAA privacy law went into effect. This law limits the ability for those with power of attorney to deal with healthcare issues unless the estate planning documents specifically mention HIPAA. Therefore, those documents need to be updated.

If the estate plan was created before 2005, it may be affected by some state-level estate tax laws that went into effect. Another important estate tax law, this time on a federal level, became effective in December 2010. This change may have made the person’s estate tax planning prior to that date obsolete. Lastly, on Jan. 2, 2013, a federal law went into effect allowing the transfer of unused estate tax exemptions to a surviving spouse when someone dies. The estate plan should be checked for all of these issues, as they can have serious tax implications for the estate.

Understanding all of these issues and keeping an estate plan current may require the assistance of an attorney. The attorney can help with will planning, trust creation and other important estate issues.