There are many reasons to review and revise your legal documents often. Your answers to these important questions may indicate a need for updates. Here are some potential issues that may arise if you haven’t checked your estate plan lately, and some ways to resolve those issues.

Potential Issue: Is the plan out of date?

Remedy: Older plans are not bad if they accomplish the client’s goals. But new and improved techniques are being developed every day.

Potential Issues: Was your plan drafted before 2011?

Remedy:  In 2011, tax laws changes and allowed a person to take advantage of the unused exemption of their spouse (with certain exceptions).  Also, in recent years the estate and gift tax exemption has been increasing.  Older plans that put assets into a Bypass Trust (sometimes called a Credit Shelter or Family Trust) up to the exemption amount could potentially lead to families paying more capital gains taxes and not avoiding any estate tax liability.    Check with your planning attorney to ensure your estate plan takes advantage of the high exemption amount.

Potential Issue: Does the estate plan distribute the property you want to whom you want, and when you want?

Remedy: Rethink what you want to pass down, in what time frame, and who you want to receive it. Have dynamics in your family changed? Perhaps you’ll need to make some changes. Call an experienced estate planning attorney to adapt the plan accordingly.

Potential Issue: Does your Incapacity Plan predate 2003? HIPAA laws allowing release of health care information have since adopted new requirements.

Remedy: Execute a HIPAA authorization with your attorney, naming fiduciaries who can access medical records, so they can handle affairs properly.

Potential Issue: Do your family members have Utah Advance Health Care Directives?

Remedy: Sit down with an attorney and execute the proper documents, and encourage your family members to keep the corresponding information cards in their wallets.

Potential Issue: Does your estate plan allow gifting during incapacity?

Remedy: Your estate planning professional can add language to your plan for the property management and living trust to grant these powers.

Potential Issue: Think of your successor trustees, personal representatives, guardians, or agents for financial and health decisions. Have any of them moved, died, become ill, or grown distant?

Remedy: Give us a call today. We will help you set up new documents, updating your choices. Consider naming an institution as a final back up fiduciary.

Potential Issue: Are decision makers relieved of liability, and does the plan address any kind of compensation or expense reimbursement?

Remedy: It can be stressful and costly to be the decision maker on someone else’s plan. Some will not wish to serve as a decision maker if they are not adequately paid or reimbursed, and certainly not if they can held liable for decisions decisions made in good faith. Make sure your plan includes protections for those you name as responsible.

Potential Issue: Are provisions in place allowing beneficiaries to replace a poorly-performing decision maker?

Remedy: If a decision maker is ill, slow to act, derelict in their duties, or making poor management decisions, it should be possible to remove them and have a new decision maker step in by operation of the agreement, without going to court. Your planning attorney can help you add appropriate language to your plan to establish these needs.

Potential Issue: Is the spouse a non-citizen?

Remedy: Special rules apply to non-citizen spouses with regard to the marital deduction and the property that will be included in the estate. Check with your law group to know what to expect.

Potential Issue: Is your estate large enough to trigger federal or state transfer taxes?

Remedy: Your planning attorney can develop strategies to take advantage of the unified credit exemption.

Potential Issue: Will the surviving spouse of a second marriage be provided for?

Remedy: Post-nuptial or pre-nuptial separate property agreements should be reviewed carefully and planning should take into account the second spouse’s needs as well as the needs of children from a previous marriage.  Your estate planning attorney can help you ensure everything is in place.

Potential Issue: Are all children (including children from previous relationships) named, provided for, or disinherited according to your wishes?

Remedy: Consider giving your spouse a testamentary limited power of appointment in case of changed circumstances.

Potential Issue: Is a guardian provided for minor children? Is the guardian also a trustee?

Remedy: Most contested estate plan cases come from shunned or ignored heirs. Anticipate who might make a claim, and adjust your plan to clearly reflect your intentions with regard to those heirs.

Potential Issue: Is there a no-contest clause for those who contest the will?

Remedy: Having your attorney add a no contest provision can cause any person challenging the will to forfeit his or her interest.

Potential Issue: Are your charitable intentions reflected in your plan?

Remedy: Many people want to donate a portion of their estate to a charity, such as a church or university, at their death. Talk to your estate planning attorney about the best options.

Whatever your situation, a frequent revisit of your estate plan is always a good idea. Give us a call and let us address your concerns, so you rest easy about your family’s future.

Marianne Ludlow and Shawna Doughman at Parsons Behle focuses on securing your future, family & business through estate and business planning, including wills, trusts, powers of attorney, trust administration, and business planning contracts and agreements.  Our offices are located in Lehi and Salt Lake City and we serve clients in Utah and Salt Lake Counties.  You can contact us by phone 801.407.6538 or e-mail [email protected]