Latest news with #trusts
Yahoo
07-07-2025
- Business
- Yahoo
‘She's in a shaky marriage that could soon end': Will my daughter's husband get my IRA when I die?
I'm 84 and widowed. My daughter is the beneficiary of my IRA and the successor trustee for my revocable living trust. She's in a shaky marriage that could soon end in divorce. How can I prevent her soon-to-be ex-husband from claiming part of her inherited IRA and assets in the trust? Aging Father 'We are blessed': My husband is inheriting a $1 million home. Should he put it in my name too? 17 bargain dividend stocks that are primed for growth — consider this before you buy 'Today is my 61st birthday': I have my ex-spouse's Social Security benefits. Should I retire at 65 and travel? 'I'm single': At 70, I have $500,000 in stocks and $220,000 in savings. How do I invest my $130,000 windfall? Stay buckled up — the market ride is going to get wilder still, says this strategist Related: 'I'm afraid to ask her': My stepmother won't show me my father's will. What now? Expect the best. They may stay together and live happily ever after. But prepare for the worst. If their marriage is on shaky ground, chances are they're headed for divorce court. Unfortunately, as much as we would all like to maintain peace and harmony in our lives, splitting assets is never easy and can lead to a lot of painful negotiation. For that reason, you are smart to think ahead. You've worked hard for your retirement savings and other assets, and I can understand that you would not like them to be divided 50/50 between your daughter and her husband (should they split). Inheritance, as regular readers of this column will know, is generally considered separate (not marital) property. Unless your daughter decided to commingle inherited funds in a joint account with her husband, they would remain separate in the event they divorced. Those tax implications will vary, all depending on the type of account she inherits. 'The IRA balance must be emptied within 10 years; this distribution period begins the year after the original account owner's death,' U.S. Bank USB says. If you were already taking RMDs, your daughter must also take a minimum distribution each year, beginning the year after your death, it adds, but RMDs are not required annually if you were not subject to distributions before your passing away. There are exceptions to the 10-year rule for non-spouse beneficiaries, it adds. They include minor children of the original account holder, a chronically ill or disabled beneficiary, or a beneficiary who is no more than 10 years younger than the original account owner. 'Non-spouse beneficiaries can open and transfer funds into an inherited IRA, take a lump-sum withdrawal or turn down the inheritance,' the bank adds. 'Spouse beneficiaries can roll the funds into an existing IRA account or open a new account.' A revocable trust that becomes irrevocable upon your death would ensure that your funds were only accessed by the beneficiary — your daughter in this case (and not her husband). It would also protect those assets from creditors. 'To maximize protection, the trust can be structured as a discretionary trust, where the trustee has complete discretion over distributions,' according to Selzer Gurvitch, a law firm based in Bethesda, Md. 'This type of trust can ensure that assets are not considered marital property in the event of a divorce,' it says. 'Another option is a spendthrift trust, which prevents creditors, including a divorcing spouse, from accessing the trust assets.' 'Protecting your children's inheritance from the potential complications of divorce is an important aspect of estate planning,' it adds. 'Trusts, prenuptial agreements, careful asset titling, and gifting strategies all play a role in ensuring that your hard-earned wealth remains in the family.' I hope your daughter lives happily ever after, no matter what she chooses. Related: My father died, leaving everything to my 90-year-old stepmother. Do I have a right to ask her if I'm in her will? I'm the executor of my mother's will. She left $160,000 in a secret savings account. Should I tell my siblings? 'She has been telling him lies': My sister convinced my father to sign everything over to her. What can I do? My father died, leaving everything to my 90-year-old stepmother. Do I have a right to ask her if I'm in her will? Don't miss: 'I don't want to end up with stalkers': Should I tell my heirs that I'm writing a will and how much they can expect to inherit? My wife and I are in our late 60s. Do I sell stocks to pay our $30,000 credit-card debt — or do it gradually over 3 years? I put my $500K inheritance into a joint account with my husband. Can I leave half of it to my son from a previous marriage? 'I do all the yard work, cooking and cleaning': I live with my daughter and her lazy boyfriend. She wants me to buy her house. Do I say yes? 'Finance makes me break out in hives': I inherited $240K from my parents. Do I pay off my $258K mortgage and give up my job? My job is offering me a payout. Should I take a $61,000 lump sum — or $355 a month for life? Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
07-07-2025
- Business
- Forbes
10 Reasons To Reevaluate Your Estate Plan Following The 2025 Tax Law
File Stack and Magnifying Glass The "One Big Beautiful Bill Act" (OBBBA) of 2025 introduces significant changes to estate and tax planning. While discussions often focus on high-net-worth families, these changes affect everyone, from young professionals to retirees. Since the law is so wide ranging, it can disrupt even the most well-prepared plans. 1. Elevated Estate and Gift Tax Exemptions The federal estate, gift, and generation-skipping transfer (GST) tax exemption is now $15 million per person ($30 million for married couples). This higher threshold is beneficial, but political dynamics could alter it again. Review your estate plan to adapt to both current rules and future uncertainties. 2. Political Risks Despite the End of the 'Sunset' Deadline The removal of the 2025 'sunset' clause for exemptions doesn't eliminate the risk of future reductions by Congress, especially if the Democrats retake the House and the Senate with a mandate to repeal the tax bill and enact the tax changes Elizabeth Warren and Bernie Sanders are advocating. Proactive planning provides the flexibility needed if rules shift again. 3. Changes in Trust Income Taxation Trusts are essential in many estate plans. The 2025 law permanently modifies trust income tax brackets and rules. Evaluating your trust structures can help minimize taxes and maximize benefits for heirs. 4. State-Level Estate and Inheritance Taxes In Massachusetts and other states with estate taxes, significant taxes may still apply despite federal thresholds. Address both federal and state tax exposures in your plan to avoid surprises. 5. Increasing Long-Term Care Costs and Medicaid Adjustments With cuts to Medicaid and other safety-net programs, relying on public benefits for long-term care is riskier. Private long-term care insurance and Medicaid planning have become increasingly crucial for middle-class families. 6. Tax-Deductibility of Long-Term Care Insurance The 2025 law maintains or increases tax-deductible limits for qualified long-term care insurance premiums. Ensure your policies qualify to maximize tax benefits. 7. Retirement Account and Income Tax Strategy Permanent changes to individual income tax provisions affect IRAs, Roth conversions, and income-shifting strategies. Aligning retirement and estate plans is essential to minimize taxes and enhance your legacy. 8. Business Succession and Asset Management With changes to valuation rules and succession planning, it's vital to review buy-sell agreements, liquidity planning, and leadership transition strategies to safeguard your business and family. 9. Management of Digital Assets and Cryptocurrency Digital assets, including cryptocurrency and online accounts, are now common in estates. Updated powers of attorney, wills, and trusts are necessary to manage and transfer these assets effectively. 10. Addressing Family, Legacy, and Non-Tax Objectives Estate planning encompasses more than just taxes. The new law may impact your ability to support family members with special needs, make charitable contributions, or protect unique assets. Regular reviews ensure your documents align with current wishes and family circumstances. Conclusion The 2025 tax law necessitates a thorough review of estate plans for everyone, regardless of wealth. From taxes and trusts to long-term care and digital assets, consulting an experienced estate planning attorney will ensure your plan is current, compliant, and aligned with your personal and financial goals.
Forbes
07-07-2025
- Business
- Forbes
Big Beautiful Bill Estate Planning Ideas
The Big Beautiful Bill has important implications to your estate planning. What should you do now? ... More What is different? getty The Big Beautiful Bill (BBB), or The One, Big, Beautiful Bill (OBBBA) is now law. What is the impact on estate planning? According to several smart advisers there is little to do as the exemption is so high. In fact, these experts suggested that pretty simple estate planning documents could be done for those with even a $30 million net worth. That, they reasoned is because the exemption is $15 million per person x 2 for a couple is $30 million. And, that amount is inflation adjusted. No doubt lots of folks will find that appealing. Most people want simple plans and documents. While that may be simple, it is not prudent for several reasons. Let us take a deeper look at what really should be done for estate planning after the BBB. What Your Planning Should Consider Now So, here is a partial list of goals and planning benefits that should be considered in your planning in the current environment: Income taxes. The BBB made wide ranging changes to income tax rules that will affect everyone's income tax planning. Estate and trust planning, particularly using non-grantor (complex) trusts, can facilitate some aspects of income tax planning. For example, the increased standard deduction of $31,500 for married taxpayers filing jointly, provides tax savings. But it also means that very few taxpayers will itemize deductions. That will eliminate deductions for charitable contributions (not counting the $1,000/$2,000 above the line deduction). Estate planning can be adapted to help maximize your charitable contribution deductions. If you shift passive income producing investment assets (e.g., bonds, dividend paying stocks) to a non-grantor trust that trust can make charitable contribution payments from its gross income and qualify for a full charitable contribution deduction. That is because trusts are not subject to the standard deduction. You will still get your full standard deduction and effectively use contributions deductions that would have otherwise been lost to offset the passive income. This does not have to be costly as you can create a trust in your home state with a family member trustee. This technique also does not have to prevent you from having indirect access to the assets involved. Your spouse can be a beneficiary so long as an adverse party approves distributions. Estate taxes. Yes, estate tax may still be relevant and how they are relevant will depend on your net worth and to what it may grow. Most important, "permanent" only means lasting until the next law change. So even taxpayers well under the new high exemption amount could be well advised to plan now while they can. If you are very wealthy, say $40 or $50 million and higher, you perhaps should continue to plan to reduce your taxable estate. First, you are already subject to estate tax under the new BBB rules. But perhaps more important, no one can predict what future administrations in Washington might do to the estate tax system. Only a few years ago the uber wealthy were focused on Democrat proposals that would have eliminate post estate planning techniques including grantor trusts and worse. So, plan in case that comes back. For those with wealth levels closer to the new exemption amount it may make sense to plan for the same reason. Asset protection planning was, is and will remain vitally important for people of all wealth levels. Remember the estate tax at present can at most claim 40% of an estate but a creditor could reach much more. Estate and trust planning are vital to protecting your wealth from claims. And, if you are shifting assets to trusts to protect them, that can also shift those assets outside of your estate. How Might Post-BBB Trust and Estate Planning Be Different? Planning should, generally, proceed using similar tools and techniques but more flexibility perhaps then before, but with some modifications. We might see a greater use of SPAT, hybrid DAPT and other means of accessing trust assets then merely dynasty trusts and SLATs. A SLAT is a spousal lifetime access trust. That means your spouse but not you can be a beneficiary. A dynasty trust often is designed to exclude you and your spouse as a beneficiary. Instead, if planning is now more for asset protection planning or 'just in case' the tax laws change in the future, you might want more ability to access trust assets. So, a Special Power of Appointment Trust (SPAT) in which someone in a non-fiduciary capacity can appoint trust assets to you, or a Hybrid Domestic Asset Protection Trust in which you can be added back as a beneficiary, may be preferable. Lifetime limited powers of appointment are rights given to a person called a powerholder to direct or appoint trust assets. Included more such powers that can be exercised even while the person who set up the trust is alive may be a way to infuse flexibility. If laws change that powerholder may appoint trust assets to a new trust or in another way to address the changes. Broader trust protector powers might make sense to build in more flexibility to address future changes. A trust protector is a person designated in a trust to hold certain powers. The most common powers given to a trust protector are to remove and replace a trustee or to change the governing law and situs of the trust. However, perhaps it is worth considering whether a trust protector can and should be given powers to modify the trust to address future tax law changes. As a safety measure, that power could require the consent of another party or perhaps a board of three trust protectors could be appointed and require a unanimous agreement to take such powerful actions. Non-grantor trusts may warrant greater consideration to facilitate income tax planning. Spousal lifetime access trusts may be created in a non-grantor "flavor" by requiring consent of an adverse party for distributions to a spouse. This might be valuable even for moderate wealthy taxpayers. Example: Middle income taxpayer Husband gifts a large portion of the couple's investment assets (address the step transaction issue) to a non-grantor SLAT to benefit wife and children who must consent to a distribution to wife. The income earned can be held in the trust and tax paid or distributed to those in a lower bracket. That can be planned so the parents qualify for new tax breaks many of which are subject to phase outs. Example: the new BBB exclusion of tip income up to $25,000 is phased out at $300,000. If the couple otherwise qualifies for this benefit shifting investment income away from them in that year (and evaluating it year after year) could enable them to qualify for that benefit. Other Planning Considerations Review existing trusts and estate plans for opportunities to modify existing irrevocable trusts to allow for step-up in income tax basis that may not have been contemplated in the initial plan. Reevaluate the title to your asset and the reasons why they were titled (owned) as they presently appear. Consider the impact of the new BBB tax laws. For example, a married couple may have their house owned as tenants in common as they wanted to be able to use ½ that asset to fund a credit shelter trust on the first death. With a permanent $15 million exemption (even if that may change in the future) it may be safer to retitle that house to tenants by the entirety if under your state law that provides better asset protection. Review existing irrevocable trusts and evaluate whether you can decant (merge) those existing trusts into new trusts with broader trust protector powers to allow for more flexibility. Review buy sell agreements and consider updating them to reflect true fair market value. Many times, these agreements tried to use a lower value to avoid estate tax but that may not be an issue post BBB. Consider estate planning beyond just estate tax considerations. There is so much more.
Daily Mail
19-06-2025
- Health
- Daily Mail
EXCLUSIVE Revealed, the NHS hospital trusts plagued by abnormally high deaths. Is YOURS on the list of the worst affected?
Five NHS trusts are plagued by abnormally high death rates, MailOnline can today reveal. Our investigation into hospitals suggests thousands of 'excess' fatalities may have occurred between them. Your browser does not support iframes. Your browser does not support iframes. Your browser does not support iframes. Your browser does not support iframes. Your browser does not support iframes. Your browser does not support iframes. Your browser does not support iframes.
Forbes
13-06-2025
- Business
- Forbes
The Parts Of Long-Term Financial Planning That Everyone Should Know
Confident young Asian woman with smartphone looking out through window while sitting in a cafe ... More having coffee. Making a personal financial plans and investment decisions. Wealth management. Business, banking, finance and investment concept Mapping out your finances for the long haul can help you grow wealth, build a reliable safety net, and weather life's twists and turns. As financial markets become more volatile and retirement planning seems increasingly out of reach, especially for millennials, it's imperative to start as early as possible, securing your financial future. Whether it's not having the right amount of insurance in place, neglecting to contribute to the correct retirement accounts, or not ensuring a seamless estate plan, many people have holes in their long-term financial planning. Learn about six key components you can include in your plan and how each one can strengthen your financial well-being. A will is a legally binding document that outlines how your property should be divided and how personal matters should be managed after your death. It can also designate guardians for your minor children and include instructions for end-of-life preferences. In contrast, a trust is a legal structure in which you, as the grantor, assign a trustee to oversee and manage assets for the benefit of specific individuals or organizations, known as beneficiaries. Both wills and trusts are critical estate planning tools that can help ensure your wishes are carried out and your loved ones are provided for. Having a will allows you to direct assets to the right people and name an executor to settle your estate. A trust offers extra benefits: It can bypass the probate process, saving time and preserving privacy for your heirs, and it can even include provisions for managing your assets if you become incapacitated—something a will cannot do. A taxable brokerage account is a regular investment account that you can open through a brokerage firm using money that's already been taxed. It gives you the flexibility to trade various assets, such as bonds, stocks, mutual funds, and ETFs, without the benefit of tax deferral or shelter. Unlike retirement accounts, a taxable account does not provide upfront tax deductions or tax-deferred growth. Instead, you pay taxes each year on any interest, dividends or capital gains earned in the account. A 401(k) plan is a company-sponsored retirement account that employees can contribute a percentage of their income toward for long-term savings. It can help automate saving, provide tax-deferred growth, and significantly boost your savings through employer matches. 'Given that just 11% of workers in private industry receive a pension, 401(k)s are a key pillar in building a secure retirement,' writes finance journalist Adam Shell. 'In fact, these tax-advantaged accounts remain the backbone of most people's retirement saving strategy.' Over decades, consistent 401(k) contributions can grow into a substantial fund to support you in retirement. IRAs come in two main types: traditional and Roth IRAs. Traditional IRAs allow you to make tax-deductible contributions in the year they're made, lowering your taxable income at that time. However, in retirement, the withdrawals you take are taxed as ordinary income. Roth IRAs, on the other hand, are funded with after-tax dollars and offer no immediate tax break, but qualified withdrawals in retirement are completely tax-free. By consistently contributing the maximum you can and investing prudently, an IRA can grow into a sizable component of your retirement nest egg. Term life insurance is the simplest, most straightforward type of life insurance. You purchase coverage for a specified term, such as 10, 20 or 30 years. If you (the insured person) die during that term, the policy pays out a tax-free lump sum death benefit to your chosen beneficiaries. If you outlive the term, the coverage ends, or you may have an option to renew at a higher rate. Term life insurance is fundamental for anyone who has others depending on their income or care. If you have young children, a spouse or aging parents who rely on you, life insurance ensures they are not left financially stranded. Indexed universal life (IUL) insurance is a form of lifelong coverage that combines a guaranteed death benefit with a cash value element that can grow over time. Unlike term life policies, IUL stays in force as long as you continue to make premium payments. It also includes a savings component that accumulates value, often tied to the performance of a market index, offering the potential for wealth building or protection. Rob Graham, CEO of Wealth Express, a platform that provides connection to IUL advisors, describes the advantage of an IUL as not just the protection of a death benefit, but also a wealth tool for during one's lifetime. As Graham observes, 'An IUL can accumulate wealth for an individual 'tax-free.' That wealth can then be accessed throughout one's lifetime for any reason, at any time, with no early withdrawal penalties (after the first year), 'tax-free' through loans that do not have to be paid back.' In practical terms, this means that as your IUL policy's cash value grows, you can borrow against it and use that money—for college tuition, a business investment, retirement income, or any purpose—without triggering taxes because loans from life insurance are not considered taxable income. Despite their potential benefits, IULs have often attracted criticism as a result of poorly set up policies. This underscores the importance of choosing the right financial advisor to help establish a strategy for an IUL. Graham notes, 'Many ill-informed agents max out the insurance and minimize the cash value component of the contract. This is bad for the consumer, and usually the consumer learns about it too late to do anything about it.' To truly realize the 'personal banking' advantages of an IUL, the policy should be designed with a relatively lower death benefit and higher contributions going into cash value, within allowed limits. While annuities are often one of the more misunderstood retirement strategies, the right product can provide a predictable income stream in retirement without exposure to volatility in the stock market. 'Recessions can be damaging to the economy and the stock market; they don't have to be damaging to your retirement lifestyle,' says Ty Young, CEO of Ty J. Young Wealth Management. 'The proper annuity, used correctly, can be the difference between a recession ruining your retirement and living the retirement lifestyle you've always dreamed of.' When you buy an annuity plan, it will pay you a guaranteed, specified sum of income upon reaching a certain date. Long-term financial wealth and security is built through incremental steps over a long period of time. Starting with the right infrastructure, such as robust estate planning, asset protection, and tax strategy is crucial. Then it becomes a process of remaining consistent in your investing and allowing compound interest enough time to accumulate.
