Readers in Texas have likely heard over the past few months that the estate tax exemption has been permanently raised to a level of $5.25 million. This, some may believe, leaves them little need for estate planning due to the size of their estate. This is not the case, at least according to one recent report that may be of interest to our readers.
In fact, by using estate planning tools such as a will or trust, people in Texas can protect many, if not all of their assets, from a sometimes-complicated probate process. In particular, a living trust can be useful to those seeking to direct how their assets are distributed after they die. This type of a trust can be altered as life changes occur, and is even allowed to be revoked if a person changes their mind about ownership.
A living trust is a common estate planning tool that is used by people who wish to avoid having their financial lives made public. The probate process, to which a will is subject, does not offer such protection. This is why may find that they benefit from adding significant assets such as a home, vacation property, valuable collections and investments into this type of trust.
Choosing the right estate planning tool for an individual estate can be confusing for some folks. To lessen these stresses, it can be helpful to work to understand all available options as they relate to the size of an estate and the desires of the person creating the estate plan. These efforts can ensure that an estate is distributed according to the wishes of the person who owned it, as well as to the best benefit of those set to inherit.
Source: MarketWatch.com, “Estate planning for the rest of us,” Bill Bischoff, May 21, 2013