Services
Estate Planning
Business Formation
Charitable Planning
Estate Planning
Estate planning is the process of arranging for the management and disposal of an individual’s estate during their lifetime and after death. It involves making decisions about how assets, such as property, investments, and personal belongings, will be distributed to beneficiaries or heirs. Estate planning often includes creating legal documents such as wills, trusts, powers of attorney, and healthcare directives to ensure that one’s wishes are carried out effectively and efficiently. Additionally, estate planning can involve strategies to minimize taxes and ensure the smooth transition of wealth to future generations. It aims to provide peace of mind and financial security for both the individual and their loved ones.
Living Trust
Advantages
- Allows you to avoid the expense and delay of probate proceedings (in most states), which can take up to a year or more to complete and are a cost to your estate.
- May eliminate the need to probate property if you own property in another state.
- Allows immediate transfer of management of your property if you become incapacitated either physically or mentally—no need to go to the court to appoint a guardian or conservator.
- Protects your privacy—remains confidential and does not become a matter of public record.
- Enables you to name someone you trust to manage trust property for young beneficiaries.
- Enables spouses to more easily use both spouses’ estate tax exemption.
Disadvantages
- Requires quite a bit of initial paperwork and can be relatively expensive to set up.
- Requires you to transfer ownership of all the property you wish to place in the trust. This may include revising title documents.
- Property owned in joint tenancy with the right of survivorship, may adversely affect the use of both spouses’ estate tax exemption.
Will
Advantages
- Often simpler and less expensive than setting up a living trust.
- No need to transfer any property to create a will or make it valid.
Disadvantages
- Requires probate to implement your will, which can be both costly and slow.
Becomes a matter of public record through probate. - Actual distribution of your property is usually controlled by the probate lawyers, working with the executor of your will. This can be both expensive and unpleasant.
- Does not provide for transfer or management of your assets or property if you should become physically or mentally incapacitated.
Business Formation
Business formation and succession planning are key when starting you business as well as throughout the life of your business. If you are starting to think about retirement, then it is also time to think about business succession.
Consider enlisting the assistance of an experienced business attorney, like those at Peatrowsky Law, LLC. We have the background and skills to help you plan for the future, putting you and your business in the best position for a profitable and smooth transition when that time comes.
Exit Strategy
Determining what will happen if and when you are no longer able to run your business is critical. The attorneys at Peatrowsky Law, LLC will discuss various scenarios with you. This process can help both us and you evaluate all of the “if this, then that” scenarios.
These scenarios may include how you will leave the business at retirement, including whether you will wind up the business, sell to an interested party, or pass it down to a member of your family. Also, remember to consider the consequences if you were to be unexpectedly struck with a serious illness or injury. Your attorney can help you set up short-term protocols if your unexpected exit is of a shorter duration and other protocols should your absence be long-term or permanent.
insurance
Disability and Life insurance are an essential funding consideration to help keep the business and your family afloat should unexpected or unforeseen events alter your succession plans. In such instances, make sure you have the right kind and amount of disability income insurance to support you and your family. Also, key man disability insurance can help keep the business running without you.
RETIREMENT
If you have not done so, then now is the time to start a retirement plan. A comprehensive retirement plan typically includes tax-deferred investments (e.g., think 401(k), SIMPLE Plans, etc.), after-tax savings vehicles, trusts, and all manner of assets designed to provide the greatest return on your hard work for a future retirement. Your estate planning attorney will have ideas uniquely tailored to your specific situation and will work in close coordination with your financial advisor. This teamwork is essential given the tax planning and beneficiary designations involved.
Successor
Are you mentoring your successor?
Think about what makes a good “you” in your business. What does it take to run your business efficiently and effectively? Once you have identified those personal qualities and traits, then it is time to select a successor—the person you want to take over. Choose wisely.
timeline
You and your attorney should develop a flexible, written timeline. While it need not be set in stone, you should know generally when you would like to retire and sell, close, or transition your company to a new owner.
get started
Not sure where to start? Does this all seema little overwhelming? Pick up the phone and call us today. Provide a copy of this article to start the process on solid footing.
Charitable PLanning
At Peatrowsky Law, LLC, we encourage and assist the tradition of giving to charitable causes. In addition to the many personal rewards inherent in making a charitable gift, most gifts also provide a current charitable income tax deduction. Some charitable giving strategies also save capital gains taxes, increase income, and provide you, or whomever you designate, with an income for life. Additionally, these types of gifts may provide an estate tax deduction — an important consideration in planning your estate.
Making the Most of Your Charitable Giving in Nebraska
If given the choice between paying taxes (involuntary philanthropy), or making a charitable gift (voluntary philanthropy), most people would choose the latter, because it gives them the benefit of knowing who the money will benefit and how it will be used. The same cannot be said for money paid to the U.S. Treasury. We help clients make charitable gifts and practice good stewardship in the most tax-efficient manner.
There are many different ways to make charitable gifts:
- A charitable remainder trust or a charitable gift annuity will give you an immediate income tax deduction, a lifetime stream of income, and a waiver of capital gains taxes owed on contributed property.
- A charitable lead trust creates an income stream to charity for a term of years with the remainder of the trust going to your children without any estate or gift tax consequences.
- A donor advised fund allows you to maximize your income tax savings on your regular monthly or weekly contributions to church or charities.
This has been a very general overview of a very complex subject matter. If there are causes or organizations you would like to support, while also maximizing your tax-saving strategies, please contact us to explore your options.
