2017 Estate Planning Updates

2017 Estate Planning Updates

The last few years have seen significant changes to estate and gift tax laws and other statutes affecting estate planning. Your assets and goals also may have changed. If your estate plan hasn’t been reviewed recently, we suggest that you schedule a meeting with us now to review and, if needed, update your plan.

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Estate and Gift Tax Changes
The estate and gift tax exemption for 2017 is $5.49 million, a $40,000 increase from 2016. The top estate tax rate is 40% of transfers greater than the exemption. Though the Trump administration’s recently released tax plan proposes to “repeal the death tax,” repeal is far from certain.

What about married couples?
For married couples, each spouse has an exemption, so in 2017 married couples can make total estate and gift tax free transfers of $10.98 million, an $80,000 increase from 2016. If the full exemption is not used by the first spouse to pass away, the surviving spouse can use “portability” rules to take advantage of both spouses’ exemptions.

Annual Gift Tax Exclusions
The annual gift tax exclusion for 2017 remains at $14,000, where it has been since 2014. Donors are able to make gifts of $14,000 to as many individuals as they choose. Married couples can make total gifts of $28,000 to as many individuals as they choose.

Joint Ownership and Beneficiary Designations
It is not uncommon for a client to discover after their relative’s death that some assets were owned jointly with others and therefore will not pass to the beneficiaries named in the client’s will or trust. Instead, those assets will pass to the surviving joint owner. Similarly, accounts with named beneficiaries will pass to the named beneficiary regardless of the terms of a will or trust.

These ownership and beneficiary designation surprises sometimes can be corrected after the client’s death through the use of disclaimers, but only if all interested parties are cooperative. It is far simpler to prevent the surprise before death by changing ownership of the asset or signing a new beneficiary designation form to be consistent with an overall plan.

If your estate plan hasn’t been reviewed recently, we suggest that you schedule a meeting with us now to review and, if needed, update your plan. We look forward to meeting with you!

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Stuart & Branigin was founded in 1878 in Lafayette, Indiana. Our experienced and knowledgeable lawyers provide trusted counsel to local, regional and national clients. Our firm is composed of five practice groups, Corporate and Non-Profit, Litigation, Personal Injury, Private Client Services, and Transportation.