The Importance of Recurrent Estate Plan Updates

[An estate case resulting in a dreaded family feud] underscores why clients should review their estate plans annually because tax laws change. Failing to do this might land families in court and entangle inheritances in litigation.

It is apparent that 2012 is a unique year for planning with the current estate tax and gifting laws. But as the years go by and laws change, are you paying attention to your estate plans and how they could be affected?  Such was the case back in 2010 when there was no estate tax, a very unique situation that some did not plan for.

It just goes to show that changing laws matter, and that your estate plans must change accordingly.

For fresh evidence of the necessity for annual visitation of the estate plan, and for the oddities of 2010, Financial Planner magazine recently published an article titled “Family Feud: Review Estate Plans Annually.” It’s the case of the family behind Magnolia Audio Visual, and the couple that sold its retail rights to Best Buy and accumulated a cool $100 million estate in the process. Unfortunately, the parents weren’t as savvy with their estate planning.

The estate plan provided that the maximum amount allowable under the federal estate tax threshold would be passed down to the children, with the rest to pass to the surviving spouse to thereby avoid immediate estate taxation. Unfortunately, the plan didn’t account for the fact that 2010 didn’t have an estate tax (thanks to expiring Bush-era laws and a gridlocked Congress).

The wife died. When the husband nevertheless claimed the estate that was to pass to the children under the estate tax planning, the children were noticeably irked. It seems they had been passed over and were in danger of losing a fortune afforded under the once-in-a-lifetime and quite unintended tax loophole. Accordingly, the children filed suit against their father on the grounds of “non-compliance, forgery and the use of undue influence.”

This case serves as a lesson to all that we should frequently update our estate plans to ensure our wishes are carried through to our loved ones.

Reference: Financial Planning (September 1, 2012) “Family Feud: Review Estate Plans Annually

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We've been putting together as many resources as possible so that we can continue to help:

  • If you’re a current client with a signing appointment or a prospective client with a consultation and would prefer that meeting take place in your own home, we can accomplish that with a little bit of pre-planning on our part and with the addition of a laptop, smartphone, tablet or other computer in your home to facilitate this virtual meeting. For those of you that need to sign legal documents, that too can be accomplished with the use of a webcam (FaceTime etc.), so that we can witness and electronically notarize all of your important legal documents.
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Thank you, Walt and the Zaremba Team

Update to our Process

The unprecedented coronavirus pandemic has taken our entire country by surprise. We understand how difficult this time is for America’s businesses and families.  However, we believe it is vitally important that we make every effort possible to continue to offer solutions that avoid disrupting our important partnership with you, your family and friends.  As you know, estate planning is not something that should wait for a more convenient time, therefore the opportunity to address your important goals both during and after this crisis should not wait.  To that end, we have added the option of a ‘virtual consultation’ to our office process.  You will now have a choice of either meeting with us in our office or in the comfort of your own home.