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Avoiding updating estate plan documents is a mistake

A concern that might not be at the forefront for Texans who have already completed an estate plan is ensuring that it is up to date. However, it is important to think about personal and legal changes that might make it necessary to alter the document to account for them. One issue that is making it wise for just about everyone who has taken the initiative by drafting estate planning documents is the changes to the tax code. Having legal advice when deciding if and how the tax changes will influence an estate plan is imperative.

In the past, people with substantial assets took various steps to shield themselves from estate taxes. The amount that people can protect has risen to $11 million for a single person to $22 million for couples. Obviously, there are not many people who have assets at that level. Strategies to protect assets are different for people who are wealthy than they are for those with a lower net worth, but there are still documents that everyone should have and these too should be updated.

A power of attorney and a health proxy will be invaluable if the testator is incapacitated. People who change jobs might forget to change their estate plan when there are different insurance policies and a retirement account like a 401(k). Those who are taking the changes to the estate tax as justification not to address other aspects of an estate plan are making a mistake. There are numerous reasons to have an estate plan including caring for children in a way that the testator wants; keeping certain people out of the process; the possible need for a special needs trust for a loved one who needs help to survive; and to avoid probate.

For those who are looking at the new estate tax limits or the current positive state of their retirement accounts and are not taking the time to update their estate plan will inevitably regret it. A legal professional can list the benefits of being active and altering an estate plan as circumstances change. This is a smart step to have the estate planning documents organized in a way that is preferable to the testator in all situations.

Source:, “Your estate plan needs an update, even if it is new,” Beth Pinsker, Jan. 18, 2018