Massachusetts Estate Planning & Asset Protection Blog

4 Essential Estate Planning Tips Every Baby Boomer Should Know

Posted by Dennis Sullivan & Associates on Tue, Oct 01, 2019

P42.Sullivan.OctBlog1One of the best ways Baby Boomers can prepare for older age, and help their loved ones after they are gone, is to make sure their estate plans are in order. An estate plan protects and transfers wealth while adhering to tax strategies and other important considerations, the former being of special importance to those of us residing in Massachusetts. A well-designed estate plan can also ensure health care wishes and personal desires are followed. 

Not having a plan, or an up-to-date plan, however, can leave decisions in the hands of others. This could devalue your estate, create unnecessary confusion, result in your loved ones turning to the court for help, and even cause infighting within one’s family. It is one of the reasons why we focus during the month of October, as well as throughout the year, on Estate Planning Awareness Week which promotes the importance of a sound plan through the National Association of Estate Planners & Councils.

Whether you are revisiting an existing estate plan or crafting an estate plan for the first time, let us share four essential estate planning tips with you right here in this article. 

 

  1. Wills and Trusts. These are the centerpieces of any solid estate plan, regardless of the size of the estate. A last will and testament is put into action at the executor’s death, while a trust agreement can be managed during one’s lifetime. A trust can also limit estate taxes and potential legal challenges. In that regard, the written language of these documents is extremely important and should be discussed with your estate planning attorney.

 

  1. Beneficiary Designations. Retirement plans, annuities, life insurance policies, and other investments, allow for the principal investor to name who he or she wants to inherit his or her investments when at death. This can be a spouse, multiple members of an immediate family, other individuals, or charities and institutions.

 

  1. Durable Power of Attorney. A power of attorney allows a designated person to make financial, legal, and other personal decisions on behalf of another person. A durability provision ensures that the document can still be used even when the creator is incapacitated. 

 

  1. Health Care Directives. Health care directives ensure that there is a selected person to make health care decisions on your behalf. Be sure to consider choosing someone with matching end-of-life views as this person may be called upon to act as you would in this situation. 

 

With so much at stake, do not wait to contact an experienced estate planning attorney for more information on this topic. Don’t wait to ask us your questions or attend one of our upcoming Trust, Estate & Asset Protection Planning workshops to learn about our Unique Process  to help you and your family to enhance the security of your lifestyle, life savings, and legacy.

We know this article may raise more questions than it answers for you. If you have specific questions, do not wait to contact us. This only starts our discussion on how to prepare for retirement as a Baby Boomer. We encourage to take the time to review each of our critical guides with the information you need on this as well. Let us answer your questions about your unique retirement needs. 

If you would like more information on Elder Law, Medicare, the Affordable Care Act, or the impact of new health care laws on your health care coverage, request your free preview of our guide, the Senior & Boomers’ Guide to Health Care Reform & Avoiding Nursing Home Poverty.  

We encourage you to attend one of our free educational workshops. The next evening event will be next Thursday October 10th 6:30 PM at the Needham  Council on Aging Center at the Heights 300 Hillside Ave. Needham, MA,  Please call 800-964-4295 and register to discover  more about what you can do to Protect your Home, Spouse, Family and Life Savings. By attending our workshop, you will also be entitle to more than $1,500 in valuable benefits, including your choice of books, DVDs and more! Call 800-964-4295 (24/7)

Tags: Estate Planning, Baby Boomers, Estate Planning Recommendations, boomers

THE RETIREMENT CHECKLIST EVERY BABY BOOMER NEEDS

Posted by Dennis Sullivan & Associates on Mon, Sep 16, 2019

P42

Did you know that an income and expense retirement checklist is considered vital? This is because, typically, there are no “do-overs” when it comes to your retirement. For example, it may be difficult to regain your present income after age 50 by switching employers or to then regain the value of your collapsed portfolio. 

Accordingly, it is important to begin planning for retirement as soon as possible regardless of your age. Once you have started planning, we encourage you to revisit your retirement checklist at least every year to make any necessary adjustments. This includes budgeting for a catastrophic change in your spouse’s or a child’s health condition giving rise to the cost of long-term care expenses.  

Presently, you may live on a fixed budget whereby your monthly expenses do not exceed your current income. It is advisable that you take your present budget and make it into a retirement budget by simply projecting the income that may decline and the expenses that could increase in the year you plan to retire. It is also important to budget for future projected expenses that you do not presently incur. 

How do you plan forward for this occurrence? At the top of your retirement checklist, you need to think about your budget. In addition to your regular monthly budget, let us share a few items you need on your retirement checklist as you consider your future retirement expenses.

  1. Tax Withholding. What will be your net annual retirement income and your annual net required minimum distribution from your IRA’s or other retirement income? It is important that you remember that 20% of your annual retirement income will be withheld for taxes by your plan administrator. Your experienced estate planning attorney can help you determine the withholding or required minimum distribution. You may also want to learn more in our report, Using Individual Retirement Accounts for Estate Planning.
  2. Long-Term Care Expenses. Unfortunately, the cost of nursing home or assisted-living expenses can potentially deplete all of your savings. Long-term care insurance can pay for and help eliminate this financial catastrophe. However, not all long-term insurance policies are alike. It is important that your attorney study the terms of this policy with you to insure that you and your spouse receive the best coverage for what you can afford. You can learn more about your insurance policies and how to best prepare for long-term care in our report, How to Set the Stage for Your Medicaid Eligibility. 
  3. Children’s Expenses During Your Retirement. Do your children reside in another state? If so, they may incur considerable travel and lodging expenses as they attend to your personal care needs on what could be many trips to your home. Likewise, do you intend for your children to expend their personal funds for the actual cost and for their families’ travel to you and your spouse’s burial and cremation services? It is important that your attorney advise you as to his or her experience as to these costs. Your attorney can also help you determine the best method for your escrowing these costs from your savings account that you have earmarked “In Trust For” or “Paid on Death” for your child’s out-of-pocket costs or reimbursement of these family expenses. 

We know this article may raise more questions than it answers for you. If you have specific questions, do not wait to contact us. This only starts our discussion on how to prepare for retirement as a Baby Boomer. We encourage to take the time to review each of our critical guides with the information you need on this as well. Let us answer your questions about your unique retirement needs. 

If you would like more information on Elder Law, Medicare, the Affordable Care Act, or the impact of new health care laws on your health care coverage, request your free preview of our guide, the Senior & Boomers’ Guide to Health Care Reform & Avoiding Nursing Home Poverty.  

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy. By attending our workshop, you will also be entitle to more than $900 in valuable benefits, including your choice of books, DVDs and more! Call 800-964-4295 (24/7)

Tags: Retirement, Estate Planning, retirement plans

ESTATE PLANNING AND NURSING HOME PLANNING CONSIDERATIONS WHEN YOU ARE CONTEMPLATING RETIREMENT

Posted by Dennis Sullivan & Associates on Sun, Sep 15, 2019

When it comes to your retirement, there are a number of important steps to take and questions to consider to help ensure that you can retire comfortably. For example, when was the last time you reviewed your estate plan and determined whether it still conforms to your goals and needs? Have you thought about your long-term care plans?

Older Americans are living longer now than ever before. As a result, people are finding themselves unprepared for the next stage of their life, both emotionally and financially. To help ease some of your worries, let us share with you a few estate planning and nursing home planning considerations when you are contemplating retirement.

Estate Planning

When contemplating retirement, do you have the answers to the following questions? What will you do in a crisis?

Have you named a decision maker who is able to act for you? It is important to ensure that your agent under your durable power of attorney not only has the ability to make long-term care decisions for you but can also engage in the planning you may need.

One of the primary benefits of setting up an estate plan is the privacy and protection for your assets it provides. Unfortunately, if you pass without leaving any planning

protections in place, your estate will be subject to probate proceedings. As a result, information about your assets will be considered a matter of public record and anyone who would like access to that information can easily obtain it.

Long-Term Care

Did you know that research tells us that only around thirteen percent of all seniors are prepared for a future that could include the need for long-term care outside the home? We cannot stress enough the importance of planning ahead and learning about your options early. Research what long-term care costs in your community, talk to your primary care physician about your future, and discuss your plans with your family.

Further, once you have your goals in mind, talk to your experienced elder law attorney. He or she can help you create a plan that meets your needs. This can be accomplished long before you require long-term care. As a result, you will have access to many more planning options that best fit your needs. We know that preparing for the next stage of your life can be overwhelming. Remember, we are here to help guide you through each step and can help you evaluate the best

planning options for you and your family. If you are ready to discuss your planning needs, do not wait to contact our office.

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy. By attending our workshop, you will also be entitle to more than $900 in valuable benefits, including your choice of books, DVDs and more! Call 800-964-4295 (24/7)

Tags: Retirement, Estate Planning, retirement plans

Estate Planning Tips for Your Aging Parents

Posted by Dennis Sullivan & Associates on Sun, Jul 28, 2019

P42.Sullivan.JulyBlog2 (1)As a child, you are likely accustomed to your parents protecting and shielding you from difficult situations. Unfortunately as you age, however, there will come a time when your parents are no longer here and it is important to plan ahead for that time as a family unit. One important step in accomplishing this is to discuss estate planning with your aging parents. To help you begin this difficult conversation, we want to share with you a few estate planning tips for your aging parents.

The first step is to discuss the needs of your aging parents and provide them with an opportunity to discuss their goals and concerns. Talking about finances, illnesses, and even death can be emotionally taxing. Ensure your aging parents that this conversation is in everyone’s best interest and is simply to ensure that all the necessary people are on the same page. It is important to approach this topic with sensitivity and to allow your parents time to express concerns, voice their opinions, and ask questions.

Second, it is important to discuss any pre-existing estate planning documents or long-term care plans your parents may already have. We encourage you to ask your parents whether they have created a will or trust, health care documents, or a durable power of attorney. If they have not created any of these documents yet, you may wish to make a plan as a family as to how you will proceed with creating the documents and the types of planning documents you need. Further, it is crucial that you ask your parents what their own wishes are for their long-term care planning. What are their goals? How can you help your parents accomplish those goals? Addressing these questions now will likely make it easier in the event of illness or incapacity.

Above all, encourage your parents to discuss their specific goals and needs with an experienced estate planning attorney who is familiar with the laws in their state. There are many different estate planning options available, some of which may fit your parent’s needs better than others. An estate planning attorney can present appropriate planning options, answer your parent’s questions, and propose strategies to help create your aging parents’ legacy.

We know this can be a particularly challenging conversation to have with your aging parents. Being proactive in creating an estate plan, however, is one of the most effective ways at providing both you and your aging parents with peace of mind. If you or your parents are ready to discuss your parent’s estate planning needs, do not wait to contact our office to set up an appointment.

Tags: Estate Planning, family, children

5 Tips to Keep Mom and Dad Safe During the Summer Months

Posted by Dennis Sullivan & Associates on Mon, Jul 01, 2019

P42.Sullivan.JulyBlog1For millions of Americans, summertime is synonymous with outside activities: trips to the beach, visiting parks, and backyard barbecues. Did you know with rising summer temperatures, however, senior adults face elevated risks of heat-related health issues? According to the Centers for Disease Control and Prevention, there are three main reasons why:

 

  1. Older adults do not adjust as well as young people to sudden changes in temperature.
  2. Seniors are more likely to have chronic medical conditions that change normal body responses to heat.
  3. Aging adults are more likely to take prescription medicines that affect the body’s ability to control its temperature or sweat.

 

With this in mind, let us proactively share five tips for helping aging parents beat the heat this summer.

 

  1. Keep Them Cool. Staying cool doesn’t just mean staying inside in air conditioned spaces. It also means planning wisely. Rather than risk sun exposure during the hottest parts of the day, schedule appointments and outside excursions for early mornings or late evenings.

 

  1. Hydration, Hydration, Hydration. Consuming ample fluids is one of the best things seniors can do during the summer. Hotter temperatures cause sweating, and Older Americans may already have a reduced capacity to conserve water. Make sure senior loved ones are drinking water even if they don’t feel thirsty and help them plan to pack a water bottle when they leave the house during the summer months.

 

  1. Dress for Success. Loose-fitting, light-colored clothes can help keep intense sunlight from damaging skin and keep the body cool. Hats that shade head and neck areas are also important, as is proper footwear. Sandals and flip-flops may be enticing, but use caution as they can also present tripping hazards.

 

  1. Plan Inside Activities. There are plenty of rewarding indoor activities that won’t leave senior parents feeling like they’re missing out on summer fun. Museums, movies, libraries, theaters, and musical performances, are just a few exciting, and air conditioned, adventures.

 

  1. Check on Them Regularly. It’s always a good idea to check-in on aging parents, but all the more so during hot summer months. Make sure their living spaces are cool, and monitor their exposure to sunlight and heat. When possible, schedule a standing time to check-in during the week.

 

We know this article may raise more questions than it answers. There is never a wrong time to get the help your aging parents or you may need. We encourage you to reach out to us and schedule an appointment to ask your elder care questions. Whether it is this summer or throughout the year, we are here to help.

For more information on how to help your family attend one of our free Trust, Estate and Asset Protection Workshops

 

Tags: in-home care, Estate Planning, family, Summer

Estate Planning Considerations For Seniors This Tax Season

Posted by Dennis Sullivan & Associates on Fri, Mar 08, 2019

The April 15th deadline to file taxes is fast approaching. As a senior, you may be aware of the steps you need to take to file your taxes as well as most of the information you need to gather and prepare. You may not know, however, that estate planning also plays an important role when it comes to your taxes. To help you be as prepared as possible, let us share a few key estate planning considerations that will guide you through this year’s tax season as a senior.

 First, did you know that that uncompensated gift transfers can penalize you in the future, specifically as it relates to long-term care planning? Any amount of money transferred within a sixty month window prior to needing care without adequate compensation can disqualify you for public benefits. While planning to leave monetary gifts to close friends or loved ones can also help you avoid transferring money at death through the estate planning process, do not act alone. Talk to your estate planning attorney about when lifetime gifting may be right for you.

 You can make gifts of money to your loved ones during your life instead of waiting until the end of your life. When you think about your legacy, however, and leaving money to your loved ones be cautious of the probate process. Probate is the court process of transferring wealth to your loved ones or intended beneficiaries through your last will and testament at death.

 Unfortunately, if you are transferring a high dollar amount to your loved ones at death through your estate planning, you may unwittingly open yourself up to federal estate tax penalties. Consider the recent case of Aretha Franklin who did not plan for the transfer of her wealth. Whether this was an intentional decision or not, this resulted in her being penalized at a forty percent rate for the amount over the federal estate tax limit. Further complicating this issue, our state is one of the last states to keep a state estate tax as well.

 For most seniors, gifting money may not be the best estate planning option. Children and other loved ones can have problems that you may not know about. For example, we encourage you to consider any incapacity or bankruptcy issues the person may have before committing to gifting that person a significant amount of money. While having the ability to shield this money from federal estate taxes may be appealing, be sure that the person you are gifting the money to is responsible enough to receive the gift. If you are eager to leave money to loved ones within the annual exclusion amount, creating a structured gift program with your attorney is one way to effectively accomplish this.

 Above all, it is important that you reflect on and update your estate planning from time-to-time to make sure the tax laws in your state have not changed. Doing some independent research or checking in with an estate planning attorney can help you stay informed about changes you need to be aware of. Remember, we are here to help guide you through each step and can help you evaluate the best planning options for you and your family. If you are ready to discuss your planning needs, do not wait to sign up for a free educational-workshop

Do not wait to think about the estate planning you need to protect yourself and your loved ones. Although tax season can be a great time to get things in order, remember, there is never a “wrong” time to ensure you have the planning you need. Do not wait to contact us with your questions and to schedule your attendance at one of our free Trust, Estate and Asset Protection Workshops.

Tags: Estate Planning, estate tax savings, Massacusetts Estate Tax, taxes

Did You Know Your Estate Planning New Year's Resolutions Can Protect Your Family?

Posted by Dennis Sullivan & Associates on Mon, Jan 21, 2019

New Years Res. Protects Your FamilyMany of us view the New Year as a fresh start. It is a time to reflect back on the things we wish we had prioritized the previous year and create resolutions to accomplish new goals or hold ourselves to a higher standard for the upcoming year.

 While many people create resolutions focusing on exercising more or eating healthier, have you considered making resolutions that can protect your family? We encourage to think about more than just spending more quality time with your family and, instead, going a step further and putting protections in place in the event you experience an accident or sudden illness.

 Do you need help knowing where to get started? Let us share three ways to create an estate plan that can help protect you and your loved ones this New Year.

 

  1. Create a plan for your minor children to keep them protected.

 When it comes to your children, you can never be too prepared or plan too far in advance for their future. Preparing for your minor children’s care in the event of your death is a necessary challenge of being a parent. One way to ensure your children are well taken care of after you are gone is to create a comprehensive estate plan that designates a guardian to care for your children. This should be someone you trust implicitly to care for your minor children and help raise and guide them into adulthood. You may also wish to plan to take care of your children financially by creating a trust and placing funds in it for their behalf. 

  1. Create a plan for yourself in the event of an accident.

As important as it is to plan for your children’s protection, it is equally as important to create a plan that protects you as well. A living will, also known as a healthcare directive, is a legal document that outlines your end-of-life medical care wishes. This document helps loved ones and healthcare professionals to make appropriate medical decisions on your behalf when you are unable to make them yourself because of, for example, you experience a serious illness or are in a bad accident. The provisions within a living will do not take effect until you are legally and medically declared unable to competently make medical decisions for yourself.

  1. Create a plan for your legacy.

Creating an estate plan is more than just compiling a series of documents. It is the embodiment of the legacy you wish to leave behind for your loved ones. Creating and sharing your goals and thought process behind making each decision related to your estate plan is a way to share your legacy with your loved ones while you still have the opportunity to do so.

These are just a few of the ways you can help protect your loved ones this year. Do you have other ideas? Do not hesitate to let us know! Your family’s safety and your legacy are very important to us. We encourage you to attend one of our free estate planning seminars to learn more and qualify for a complimentary meeting with an attorney so we can discuss your estate planning related questions.

Tags: Estate Planning, durable power of attorney, living will, massachusetts estate planning strategies, legal guardians, New Year's Resolutions, Estate Planning Recommendations, 2019

5 Questions to Ask When Updating Your Estate Plan in the New Year 2019

Posted by Dennis Sullivan & Associates on Mon, Jan 07, 2019

P42.Sullivan.Blog.Dec1Creating a personalized estate plan may be the single most important thing you can do to make sure your decisions are honored if you become incapacitated or when you pass away. If you do not have an estate plan right now, or it has been years since you reviewed it, the new year may be the right time to ensure you are able to protect yourself and those you love most.

Much of estate planning deals with protecting and distributing property. A Last Will and Testament, for example, provides instructions for how a deceased person’s possessions should be distributed. Similarly, a Revocable Trust can direct the distribution of assets upon one’s death, although it can also manage the creator’s assets while he or she is alive.

There is much more to estate planning than Wills and Trusts, however, and your estate planning attorney can provide plenty of guidance. Let us share five questions to ask not only when you are considering crafting an estate plan but if you are updating an existing plan in the new year.

 

  1. Did you move to a different state? Every state has its own laws governing estate planning. Some features in an existing plan will be unaffected, while some key items may need to be revised. Do not wait to review with an estate planning attorney in your new state to ensure your plans can be fulfilled as you originally wanted them to be.

 

  1. Do any of your beneficiaries have special needs? If a special needs loved one is named in your estate plan, then it is worth exploring ways of specifically providing for them, especially after you are gone. Unfortunately, without planning that contemplates the needs of your disabled loved one, he or she may be at risk of losing valuable government benefits.

 

  1. Do you need to update a power of attorney? A power of attorney document gives someone else the legal authority to make decisions on your behalf. The document can be tailored to meet your specific needs, or provide for general decision making authority. Talk to your attorney to ensure there is a durability provision to cover the possibility of your incapacitation.

 

  1. Have you considered advanced healthcare directives? Advanced healthcare directives, including tools such as the living will, are legal documents in which a person specifies what actions are to be taken regarding his or her health if he or she is no longer able to make decisions. You may want to review any existing plans to ensure you have the right person named to make your healthcare decisions.

 

  1. Do you want to change beneficiaries? A marriage, a death in the family, a divorce, or the birth of new child or grandchild, are only a few reasons to update beneficiary designations in estate planning documents. You may also want to add a charity or a cause you care about. The new year is a great time to do so.

 Do not wait to think about the estate planning you need to protect yourself and your loved ones. Although the new year can be a great time to get things in order, remember, there is never a “wrong” time to ensure you have the planning you need. Do not wait to contact us with your questions and to schedule your attendance at one of our free Trust, Estate and Asset Protection Workshops.

Tags: asset protection, long term care, Retirement, Estate Planning, Baby Boomers, Elder Law, HIPAA, durable power of attorney, Health Care, health care proxy, seniors, estate tax, family, New Year's Resolutions, Estate Planning Tip, 2019

Understanding Long Term Care Planning

Posted by Dennis Sullivan & Associates on Fri, Jan 19, 2018

Facing the enormity of long term care, whether it is the financial, healthcare, emotional or psychological issues, it is so overwhelming. 

It's needs a team effort!  With the help of family, friends and our team here at Dennis Sullivan and Associates you can make the enormity of long term care manageable 

 

What exactly is "Long Term Care Planning" ? 

Here's one way to look at long term care planning: 

In today’s world, the question is no longer only, “What happens when I die?, but now we need to plan for “What happens if I live?” An estate plan covers the scenario of, What happens when I die.  But long term care covers a large variety of other factors and scenarios that sometime families forget to consider such as what happens if I live but am not healthy and have increased health-care costs and need to rely on others for assistance, either temporarily or on a permanent basis. The estate plan does not address this need. An estate plan can help you answer the first question, but a long-term care plan can help you answer both the first and second questions. Let’s put it another way. An estate plan insures that if you have assets when you die they will be passed in the manner you wish. The key word is “if.” The plan will not, however, guarantee that there will be anything left at that time to pass. Your assets could be mostly or entirely wiped out by a lengthy illness, hospital, and/or nursing home stay, leaving your spouse and other heirs with nothing.

 long Term Care and Medicaid:

I had a conversation last week with a married couple for whom we are preparing a Medicaid application. John is in a nursing home, and Mary is healthy and living at home. I explained to them that Mary can keep half of their countable assets, in their case $75,000, but that they must spend down to below that dollar amount by the last day of the month directly preceding the month we want to qualify John for Medicaid. I have had this conversation numerous times with clients in John and Mary’s situation, and know all too well that this simple instruction is not always followed. The largest part of most spend downs typically goes to the nursing home. But, as most people do, myself included, we wait until we get a bill before we pay it. If I owe you money, I’m not going to chase after you for a bill. Whenever you get around to it and invoice me, then I’ll pay it. The longer the money stays in my bank account, the happier I am. However, this can get you into big trouble and cost you tens of thousands of dollars if you wait for the nursing home bill. If we want John to be eligible for Medicaid next month and we know that he owes the nursing home $20,000 for the past two months of care, but the nursing home hasn’t yet presented Mary with a bill, it does not matter that Mary and John legitimately owe the facility the money. If that $20,000 is still sitting in their bank account next month, causing their account balance to exceed $75,000, John cannot qualify for Medicaid. Even worse than that, he can’t even qualify for next month. He has to wait until the following month, which means they will owe the facility another $10,000, leaving Mary with $65,000 to live on.


So Much to Discuss

For more information on Long Term Care Planning we encourage you attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy. January sessions are filling up fast call or register on line to reserve your seat today.  

At the Estate Planning & Asset Protection Law Center, we help people and their families protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future. 


Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: Retirement, Estate Planning, Baby Boomers, Elder Law, Attorney, GST tax, Massacusetts Estate Tax, Financial Planning, taxes, coverage, tax liability, tax exemption, Tax Savings, tax deductions, tax reform, New estate tax law, IRS, federal, Estate Planning Tip, Massachusetts, senior, Estate Planning Recommendations, Dennis Sullivan, tax, Capital Gains Tax, new regulations, New Tax Bill, Tax Bill, 2018 Tax Bill

New Tax Bill: What you need to know

Posted by Dennis Sullivan & Associates on Fri, Jan 05, 2018

How does the new tax bill affect you and your family now and in the future?

The new tax bill has officially been passed by Congress and signed by President Trump, what does this mean for us?  The answer to this depends on many variables discussed here. 

 

First of all, these changes don’t apply until you file your 2018 taxes, meaning that you won’t have to worry about the new law when filing your 2017 income tax returns this spring.  That being said, still we will be experiencing the greatest overhaul of the tax laws in more than 30 years.  The last major changes having been made under President Reagan in 1986. 

One change you can expect to see is that both corporate tax rates and personal income tax rates will drop.  There are also other changes which limit or eliminate personal deductions.   The changes that affect corporate tax rates are permanent, and the changes that affect individual tax rates and deductions are not.

Also in the new tax bill you will find a “sunset” provision, meaning that the new law – as it applies to individuals – will expire on December 31, 2025.   That is, unless Congress agrees to extend the law.  That, of course, will depend on the political and economic climate 8 years from now, including whether the economy responds the way Republicans say it will

       Now let’s take a look at the changes that are likely to affect the average senior.  Good news, the tax rates have been lowered a bit.  There are still 7 tax brackets but the rates have changed with the top rate lowered from 39.6% to 37% and the threshold at which each rate is reached has been altered. (The corporate rate reduction is much greater, from 37% to 21%).

       Some of the most significant changes relate to deductions.  The standard deduction has been doubled to $12,000 for a single person and $24,000 for married couples but personal exemptions have been eliminated.  The deduction for state and local taxes will be capped at $10,000, something that could hurt many Massachusetts residents and especially homeowners because we have high real estate and state income taxes.  


So Much to Discuss:

For the first time in decades major overhauls to the tax system are happening! This is an enormous change that can affect your estate planning and asset protection as well. Be sure to stay tuned as we will discuss more about this new tax bill in our next blog post!    

For more information we encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy. January sessions are filling up fast call or register on line to reserve your seat today.  

At the Estate Planning & Asset Protection Law Center, we help people and their families protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future. 


Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: Retirement, Estate Planning, Baby Boomers, Elder Law, Attorney, GST tax, Massacusetts Estate Tax, Financial Planning, taxes, coverage, tax liability, tax exemption, Tax Savings, tax deductions, tax reform, New estate tax law, IRS, federal, Estate Planning Tip, Massachusetts, senior, Estate Planning Recommendations, Dennis Sullivan, tax, Capital Gains Tax, new regulations, New Tax Bill, Tax Bill, 2018 Tax Bill

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