New York Estate Planning Lawyer Blog

One estate planning scam is growing in popularity for people who are looking to begin crafting their estate plan and have amassed wealth or business over their lifetimes. The estate planning aggregator claims to do comprehensive planning for people who have concerns about taxes on their wealth or business issues in their estate.

Estate Planning Aggregator

An aggregator is a person who claims to do comprehensive estate planning for individuals with complex estates. Typically, they recommend that you purchase a “wealth blueprint” or something similarly named for tens of thousands of dollars that will detail how exactly your estate will be taken care of.

One New York resident, now 65 years old and in retirement, has amassed a Las Vegas chip collection worth an estimated $500,000 over the course of two decades. However, he is childless, and no one in his extended family has expressed an interest in keeping the collection. He is also concerned that they will sell the collection for far less than its actual worth. Collectors can spend a lifetime accumulating things like baseball cards, comic books, casino chips, and art. However, too often these collectors do not think about what to do with these collections once they pass away.

The Need for Proper Planning

Many collectors hope that someone in their family or group of friends will enjoy their collection enough to keep it and maintain what they have done. Others think that another collector will pay a lot of money to their heirs for what they have amassed and assume that the heirs know what it is worth. Some hope that their collections will be donated to a museum in order to be displayed for posterity. However, none of these plans can be known for certain without proper estate planning.

If you want to lower your overall taxes for this year, now is the time to act. The opportunities to cut taxes on your overall bill are reduced dramatically after December 31. Many taxpayers forget about these opportunities or act too late to take advantage. In addition, Congress has yet to enact any intense tax changes this year, unlike the changes made in 2013. In fact, legislators have not moved on dozens of taxpayer friendly provisions that expire January 1.

Provisions that are Ending

One of the most popular provisions on the chopping block is a law that allows owners of individual retirement accounts who are 70½ and older to give up to $100,000 of their IRA assets directly to charity each year. In addition, a federal write-off for state sales taxes instead of state income taxes and a deduction of up to $4,000 a year for qualified expenses for college or other post-high school education may also end this year.

Part of proper estate planning means safeguarding not only your physical, tangible assets but your digital assets, as well. Many people do not protect these assets for a variety of reasons: a few do not think that it is important, some do not know how, and others simply do not want to think of the prospect of estate planning. However, protecting your digital assets can be easy and doing so will not only give you some peace of mind but will do so for your loved ones, too.

Why You Should Protect Digital Assets

You can do and buy just about anything online nowadays, and most of it you can accomplish with the phone in your pocket. Digital assets are more plentiful than ever, and you might not be aware of how much you have actually amassed in this form. One study by McAfee, a computer protection company, found that the average person has over $35,000 worth of digital assets on various devices that they own.

The ethical will, a document with no legal significance but can be supplemented to a regular will as part of the estate planning package, is meant to share personal lessons and advice with loved ones in addition to passing along physical parts of the estate. While the concept of an ethical will has dwindled in recent decades, the concept has seen resurgence in the technological age.

What is an Ethical Will?

Originally an oral tradition, ethical wills date back as far as 3,500 years. These wills have been used for millennia to pass on life lessons and ethics to the younger generation. Beginning around 1000 A.D., ethical wills began being written down and some still exist to this day.

With the end of the year approaching, it is good time to review your estate plan and take care of any last minute financial chores before any new tax and estate planning laws take effect for the following year. Here are eight basic items to check off of your to-do list as the end of the year approaches:

Review your Current Retirement Accounts

With the stock market rebounding this year and other market indexes at all-time highs, it is important to revisit your current retirement accounts and consider reallocating your asset distribution within your retirement accounts. It is also a good chance to see if you are on track with your contributions for the year, especially if your employer matches your contribution to the account. Even if you can’t make the maximum this year, consider bumping up your contributions until the end of the year.

Millions of elderly and disabled Americans receiving Social Security benefits will see a small increase in their government payments next year. The Social Security Administration announced earlier this month that it will be adding a 1.7% cost of living increase for the nearly 58 million Americans receiving federal retirement or disability benefits.

2015 Increased Social Security Benefits

On average, this increase would add $22 per month for retirees, and this makes for the third straight annual increase in Social Security benefits in as many years. The cost of living increases have all been between 1.5% and 1.7%, and this year’s increase matches the 1.7% rise in consumer prices in September. This is according to the data released by the U.S. Labor Department last week. According to the American Federation of Government Employees, more than 2.5 million federal government retirees will also receive a 1.7% cost of living increase.

The federal estate tax is no longer the biggest concern for many people going through the estate planning process. However, this was not always the case. In 2004, any estate worth more than $1.5 million, or whose estate owner made gifts above that limit while alive, were subject to federal tax at top rates of almost 50%. There was extreme uncertainty as the federal tax levels bounced around from year to year and even disappeared entirely in 2010, which made effective planning exceedingly difficult.

Finally, last year Congress set up a new estate and gift tax rate, topped at 40%, and raised the exemption level to $5.34 million per person. Each year that number is adjusted for inflation and the level is expected to be set at $5.43 million per person next year.

New Tax Saving Opportunities