There is a popular misperception among many seniors that in order to protect their assets from creditors, including the cost of nursing home care, they should consider gifting their assets to their children.
Dying intestate can have unintended consequences for pretty much every family type. However, it is especially painful if there are unmarried partners or stepchildren, who are left out under the law in almost every scenario.
To protect assets effectively, you have to store them in the right legal entity. However, that can depend on whether you’re looking to protect business assets, avoid estate taxes, or protect personal assets from legal liability while running a business.
Different people have different needs, and for most people, starting with basic legal documents, such as a will and power of attorney, are a great place to start and can make a big difference.
First, debts in a person’s estate are payable from the decedent’s assets in the course of administering their probate estate or administering their living trust estate.
There are many different configurations of blended families. However, they are generally made up of married couples who have children from previous marriages or relationships.
Federal estate taxes were created in 1916, taxing estates valued at over $5 million. This amount changed to $50 million in 1932. In 1940, it dropped to $10 million, then $5, then $3. In 2002-2007 estates worth more than $2 million paid the tax.
A primary benefit of using TOD/POD designations is that assets held in the account will pass automatically to the beneficiary without having to go through probate.
