When you are receiving an inheritance, you may wonder if you are required to pay a tax on the inheritance. The answer is probably not. The recipient of an inheritance is not going to be paying transfer taxes on the inheritance unless there is an inheritance tax in the state within which the recipient resides. Only six states have an inheritance tax (though Kentucky is one of them). There is no federal inheritance tax. An inheritance tax is not the same thing as an estate tax. An … [Read more...] about Do I Pay an Inheritance Tax When Someone Leaves Me Money?
In the field of estate planning the acronym ILIT stands for an irrevocable life insurance trust. This type of trust can be useful for those who are exposed to estate taxes. There is a federal estate tax that is applicable in all 50 states, and some states have state-level estate taxes. We have offices in Kentucky and North Carolina. These states do not impose state-level estate taxes. Federal Estate Tax Parameters Before we examine the value of an ILIT, we should provide some background … [Read more...] about What Is an ILIT?
Studies are done periodically that are intended to evaluate the estate planning preparedness of people in the United States. They consistently find that an alarming percentage of people are going through life without all of the appropriate estate planning documents. While some older people are remiss, the majority of younger adults are unprepared. This is unfortunate, because estate planning is important for responsible adults of all ages. This is especially true for parents of young … [Read more...] about Does a Young Adult Need an Estate Plan?
People who have been very successful financially must consider the impact of the federal estate tax. This tax carries a 40 percent maximum rate that can significantly erode the legacy that you are passing on to your loved ones. There is an estate tax credit or exclusion that separates those who must pay the tax from those who are exempt. In 2014, the exact amount of the federal estate tax exclusion is $5.34 million. Under current laws there can be annual adjustments to account for inflation. … [Read more...] about What Is Estate Tax Exclusion Portability?
Estate planning is essential for responsible adults of all ages. But surveys consistently indicate a lack of preparation. Most American adults have not executed all of the appropriate estate planning documents, and younger people are especially remiss. Clearly, you are probably not contemplating death when you are in your 20s, 30s, or 40s. At the same time, people of all ages do pass away each and every day due to catastrophic illnesses and accidents. Some lose their lives serving their … [Read more...] about What Is the Nomination of a Guardian?
You may shy away from the notion of creating a trust because you do not consider yourself wealthy. It is true that certain types of trusts are used by high net worth individuals for tax savings and asset protection. However, trusts can also be useful for people of ordinary means. One of these is the revocable living trust. In this post we will look at the benefits that you gain when you create this type of trust. Probate Avoidance If you decide to use a last will to record your final wishes, … [Read more...] about Why Would I Want a Revocable Living Trust?
Powers of attorney are used in the legal field for a variety of different purposes. Broadly speaking, a power of attorney is utilized to appoint someone else to act on your behalf in a legally binding manner. Types of Powers of Attorney in Ashland There are different types of powers of attorney in Ashland. One of them is the general power of attorney. General Power of Attorney The anatomy of a power of attorney is comprised of the grantor or principal, and the agent or attorney-in-fact. The … [Read more...] about Powers of Attorney in Ashland: What Is the Difference Between a General and a Limited Power of Attorney?
A power of attorney consists of the grantor or principal and the agent or attorney-in-fact. The grantor is the person who is granting the power of attorney. The agent or attorney-in-fact is the individual who is empowered to act on behalf of the grantor. Because the term attorney-in-fact is utilized, there are those that harbor a misconception. They are under the impression that you must be a lawyer to act as an agent. In fact, this is not the case. In this context the term attorney is used to … [Read more...] about Who Can Act as an Agent Under a Power of Attorney?
There are various different ways that you can transfer property to someone else, either while you are living, or after you pass away. To create an effective estate plan you should consult with an estate planning attorney, gain an understanding of all of your options, ask questions, and make informed decisions. If you buy into some easy answers that you hear people talking about around the water cooler, negative consequences could result. One of these notions is the idea that joint tenancy is a … [Read more...] about What If I Create a Joint Tenancy With My Child?
A power of attorney is a document that is used to give someone else the ability to make legally binding decisions on your behalf. The document is meant to serve your needs, and you can shape it to do just that. Incapacity Planning The type of power of attorney that is used for incapacity planning purposes is the durable power of attorney. This type of POA will remain active if you become incapacitated. When you have a durable power of attorney in place, your hand-picked representative will be … [Read more...] about When Does a Power of Attorney Go Into Effect?