Ten Serious Mistakes to Avoid in Estate Planning

7. Failing to Provide Flexibility in

an Estate Plan.

Good estate planning now requires that a will provide for the most flexibility possible. In order to take advantage of whatever the laws may be when you die, if you have a spouse and children (and the children are also the children of your spouse – in other words, not a second marriage/stepchildren situation), we suggest that, in most cases, everything be left to the surviving spouse, but that the spouse have the option of “disclaiming” property into a trust for the benefit of the spouse and children. By providing this option, depending on what the Federal Estate Tax laws are when you die, your spouse can take advantage of whatever tax exemption may then exist and reduce ultimate taxation that your children will incur.

A disclaimer trust can provide extremely liberal benefits for your spouse while preventing the disclaimed property from being included in the surviving spouse’s estate for tax purposes.
Similarly, too many wills are too rigid in terms of when beneficiaries of trusts established under wills can be given distributions. You will be gone, and you cannot possibly anticipate every change in law or every change in circumstances of your loved ones. To the extent possible, your will and estate plan should provide for flexibility.

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