Estate planning can be a complicated process because it comes with many pieces to the puzzle. Each plan is unique because everyone has wishes and needs they would like to be fulfilled. A lot goes into this process, making it easy to be confused and make mistakes. Plus, many parties are involved, from survivors and beneficiaries to trustees and executors. If you want to avoid these pitfalls, hire an estate planning attorney. Here are a few crucial mistakes they'll help you avoid.
Not Writing a Testament
These documents are vital and should be written to ensure your assets are distributed the way you want them to. Without one, this task will solely be left to the state to decide, causing several problems for your family and loved ones when you die and making them lose control over the assets and pay more taxes.
A lawyer can help you craft a testament that fits your needs and desires, detailing who gets what. They'll also ensure they clearly state what happens to your assets if you become incapacitated. Additionally, they can help you set up trusts to care for others, such as your elderly parents. This will ensure your property is distributed according to your desires.
Naming Just One Beneficiary
Naming only one beneficiary on a form is a dangerous move. This person will be the sole recipient of your assets. But what happens if that person is not around to receive it? What if they die before you? These are all critical questions you need to consider when choosing an heir.
An attorney can help you select several beneficiaries to prevent this from happening. They'll ensure these individuals are trustworthy and can handle such a large amount of money or property. They'll also discuss your assets, liabilities, and goals for the future and help you achieve them according to your desires.
Reporting Your Assets Inaccurately on Tax Returns
Taxes are an essential aspect of planning that should be accurately reported to avoid penalties. Failing to report your assets properly can lead to hefty fines and penalties from the IRS. A lawyer will ensure you're reporting all of your assets, including bank accounts, retirement accounts, and investments, to avoid this issue. They'll also ensure that these assets are included in your planning documents as well.
Planning is a crucial part of the financial process that everyone should consider. It isn't just about wills and trusts, but also about your financial future and protecting your family and loved ones. An attorney can help you achieve this goal.