YEAR END PLANNING CHECKLIST

As the year comes to an end, it is a good time to take stock of your current circumstances and evaluate if your goals are being achieved and wishes fulfilled, including your estate and related planning goals. There is no time like the New Year to make planning a priority. You should review your existing estate planning documents, if any, and determine whether updates are needed to reflect not only your current circumstances, but also the new exemption and exclusion amounts. For example, in 2023 the Federal Estate Tax exemption will be raised from $12.06 million to $12.92 million per individual, the annual gift tax exclusion will increase from $16,000 to $17,000, and the New York Estate Tax exclusion amount will increase from $6.11 million to $6.58 million. New Jersey does not currently have an Estate tax.

When reviewing your planning, it is a good idea to review your estate planning documents with the following in mind:

1. Gifts. Consider whether you wish to maximize the benefit of the current tax laws through the utilization of lifetime gifts.

2. Fiduciaries. Are the people you have named as Executor, Trustee, Health Care Proxy, and/or Agent under a Power of Attorney still the people you want to be in charge?

3. Beneficiaries. Do your retirement accounts and insurance policies name a beneficiary or contingent beneficiary? Are the beneficiaries still individuals you would like to receive these assets? Are the beneficiaries named in your Last Will and Testament and/or trust still the individuals you want to inherit your assets?

4. Digital Assets. Do your loved ones know how to access your digital accounts? It would be helpful if your Executor knew how to access your passwords in case of an emergency. Similarly, if you own any cryptocurrency, it is very important that you have a plan in place so that your beneficiaries can gain access to your accounts after you pass away.

5. Business Succession Planning. If you own a business, it is crucial to have a plan in place in case you become incapacitated or pass away. Moreover, if you have partners, you want to make sure you have a buy-sell agreement so that you do not have to run your business with your partner's spouse.

6. Inventory of Assets. It is helpful to have a full list of all assets that you own (either solely or jointly) and list any named beneficiaries. This way you can determine if there are any assets that you have not addressed or not named beneficiaries for (if appropriate) and your estate planning goals coordinated with your non-probate assets.

7. Transfer of Assets. Make sure that if you have a trust, all assets that you want to be owned by it are titled in the name of the trust, and that ownership and beneficiaries are properly coordinated with your goals. 

8. Family. Disagreement among family members upon your death is often the largest threat to your estate planning. You should have a discussion with your family or write a letter of intent to your family to make your wishes known to them in the hopes of preventing conflict between them upon your death.

We advise clients to review their estate planning and related documents periodically. Gathering the information discussed above will help ensure that you and your family are protected. Pashman Stein Walder Hayden, P.C. has helped many individuals with their estate and related planning needs. If you are interested in our assistance, please contact our Trusts & Estates attorneys.