The Tax Cuts and Jobs Act of 2017 (TCJA) will bring many changes to people's personal income tax returns in California and elsewhere. Many of the changes are effective in the 2018 tax year, and will be reflected in people's tax returns filed in 2019. The far-reaching changes may necessitate revisions in the estate planning programs that people have established, so that it is important to check with the estate planning attorney and any tax specialist who assisted in establishing one's estate plan.
In California and elsewhere, people tend to be confused when discussing the difference between a will and a living will. It is important to know how the two documents differ so that one can see how each of these legal instruments is vital to a full estate plan. When meeting with an estate planning attorney, all of the different documents that make up the arsenal of legal protections will be explained and discussed.
Estate planning in California is not something just for the wealthiest residents of the state. All adults need to consider an estate plan due to a number of very practical reasons. For one thing, when there are minor children, a couple can hardly fail to take some basic estate planning steps to assure a secure future for the children should both parents die unexpectedly while the children are minors.
An estate plan for a California resident is a dynamic program that continues to change and grow with the individual's family and financial goals and needs. Estate planning is a dynamic process that includes areas of preparation for the future and even for the maintenance of one's current finances. With living trusts, for example, one's assets may be turned over to a trust that will function in accordance with the maker's wishes while the maker is still alive.
California has a large population of seniors, many of whom do not have any estate planning documents prepared. It is crucial for persons in that age demographic to act quickly to evaluate and maximize the use of whatever estate planning tools may yet be available. Another large group of senior citizens may have estate planning documents, but they may be decades old and in serious need of revisions and updating.
People in California and elsewhere go through all kinds of gyrations to escape the suggestion that they may want to get their elder law planning in order. For most people, that is a feared subject that brings up the very end of life and the horrific possibility of dementia or other disability. It is possible, however, to view the need for elder law estate planning as a time-saving, financially wise, and necessary function to best take care oneself and one's heirs when the time for doing so arrives.
Trusts are often used in the planning of estates in California by those who want to protect and distribute their assets as desired. There are two general kinds of trusts used in estate planning, testamentary or living. A testamentary trust is drawn up as a provision in an individual's last will and testament.
Acts of nature have been particularly brutal in California and other states this year. These horrific traumatic occurrences have resulted in the substantial loss of life and property. From the financial perspective, there are some general estate planning measures that people can take to protect themselves from these types of devastating tragedies.
Anyone may die with assets that were not accounted for during life or that were not prepared for an orderly disposition at death. For those situations, where even a single asset is left hanging, an estate may have to be opened under California law to account for the property and pay taxes where necessary. By engaging in just a little bit of estate planning, an individual or married couple can make a will or mutual wills and assure themselves that each asset will go the heirs that they designate.
The method of titling the ownership of property in California and elsewhere is generally an integral aspect of proper estate planning. By configuring the title to assets in designated ways during the life of the owner(s), estate planning can assure certain outcomes automatically on the death of an owner. The simplest form of ownership is where one individual owns the property in his/her name alone. If the asset is real estate, the single ownership model is called "fee simple" ownership, which represents the highest degree of unfettered ownership in real property.