Estate planning is often a legal and accounting device people use to take advantage of certain tax breaks and protect their heirs from heavy estate taxes. While it is true that estate planning can help anyone to get the tax breaks that are available, there are plenty of non-tax reasons for estate planning. Many of these non-tax reasons can be critical to the financial future of your family.
In your will, which is part of your estate planning, you establish who you want as your estate administrator. This is important because if the probate court assigns your administrator, then you could get someone who does not share your views on how your assets should be distributed. You also want an administrator who understands the process to make everything easier on your family.
The distribution of assets from the estate of a deceased individual is not always a given. If the expenses of the estate outweigh the assets, then there will be no assets left to distribute to beneficiaries. If you have an array of assets that includes investments and real estate, then it is important to outline in your estate planning how you want your assets distributed after you have passed on. The distribution of assets is one of the most important non-tax functions of estate planning.
Without a properly structured estate, it would be impossible for you to have any kind of charitable organization created with your assets. It would also be extremely difficult for any charity that you worked for to receive any kind of donation, even if you verbally made the commitment while you were alive. Establishing a charity must be done through estate planning, because that will give the probate court all of your ideas on how you want the charity to be created and how much you want to use to fund it.
Estate planning has many benefits for you while you are still alive. For one, a good estate planner can set up a variety of methods to protect your assets from creditors, court judgments, and Medicaid. This protection of assets can be critical if you are very concerned about making sure that your family is financially secure after you have passed on. Protection of assets also prevents anyone from trying to scam your family with a shady lawsuit.
As part of the elder law practice of an estate planner, you can choose to get a jumpstart on your Medicaid application process. It is an extremely complicated process and the sooner you get started on it, the more of your assets you can protect and the easier you will make it on your family.
Estate planning is done for many reasons and for any type of individual or family. You do not need to have significant financial resources to enjoy the benefits of estate planning. Actually, it can be said that it makes good sense to protect what assets you do have and the future of your family with the services of an estate planner.