Nevada residents may want to ensure that their estate plans and wills are updated to ensure that they are in line with tax laws that went into effect as of 2018. Many had worked with estate planning attorneys and financial planners to develop strategies to avoid a massive estate tax hit to their heirs after death.
However, as of 2018, the federal exemption for estates has roughly doubled to $22 million in the case of married couples. Older estate plans may use even more work-arounds, because the estate limit before taxation was only $600,000 in 1997. For married coupless with estates worth less than $22 million, it may no longer be necessary to use certain types of trusts that were formerly utilized for estate tax purposes.
However, a change in tax policy does not mean that trusts are no longer an important part of estate planning. On the contrary, they can be an effective way to manage gifts on many levels, with benefits that go beyond the estate tax. They can be used for special needs family members, to handle bequests to children and to avoid the probate process. Furthermore, estate planning also has non-financial benefits as well. Financial and health care powers of attorney proxies can be critical in times of need. It’s also important to keep an eye on assets like 401(k)s and life insurance policies, and their beneficiaries should be updated in case of life changes like death, divorce or remarriage.
No matter the size of one’s estate, working with an estate planning attorney can be a critical part of preparing to care for family members. Having proper wills and other documents can make all the difference when necessary.