Estate Planning

Status of the Estate Planning and Tax Laws as we Enter 2022

As we kick-off the new year, where do things stand as far as the federal and state estate planning and tax laws?  We certainly suffered a bit of whiplash with all the potential changes that were initially proposed as part of the Infrastructure Investment and Jobs Act but ultimately not included in the final legislation that was signed into law on November 15, 2021.  Still on the table is the Build Back Better Act (BBBA).  The BBBA was passed by the House of Representatives on November 19, 2021, and will be put before the Senate later this month.  If passed, the...

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CHARITABLE GIVING THROUGH RETIREMENT ACCOUNTS

It’s that time of year where everyone starts to think about making charitable donations, whether that be for the simple act of kindness, the goal of reducing income taxes owed for the year or both.  Whatever the reason, if you have charitable intentions heading into the holiday season, this post is for you.   This post discusses using retirement accounts for charitable giving. There are many benefits to using your traditional retirement accounts to make lifetime charitable gifts and to make charitable bequests upon your death. For lifetime charitable gifts, if you are over the age of seventy-two (72) years and, as such,...

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ESTATE TAX PORTABILITY EXPLAINED

You may have heard the term “portability” thrown around in the past few years in consultation with your attorney or tax preparer, but do you really understand what it means?   In this post, we will take the time to explain portability and why it could be an important tax planning tool for you. Portability, in the simplest of terms, is the “ability” of a surviving spouse to “port” their deceased spouse’s unused estate tax exemption amount (“DSUEA”) remaining at the time of death. As explained in our last blog post (https://allylegalplanning.com/estate-and-gift-taxes-explained/), the amount each individual can exempt from the federal estate...

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Estate and Gift Taxes Explained

The estate tax is a one-time tax that may be assessed against a person’s estate at the time of their death.  There is currently a federal estate tax, and some states also have a separate state estate tax, including Maryland. At the most basic level, if the total value of a deceased person’s assets minus liabilities at the time of death (the “net estate”) is over the allowable exemption amount, the estate tax will be assessed against that person’s estate.  If an estate tax is due, the payment is typically made from the net estate prior to distribution to any...

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Refinancing when your Home is Titled to your Revocable Trust

With interest rates dropping to a historical low during the pandemic, lots of people took the opportunity to refinance their mortgages.  If you refinanced your mortgage in the past year and you also have a revocable living trust as part of your overall estate plan, you need to check the titling of your property to make sure your property is still titled to your revocable living trust.  Most people who set up a revocable living trust understand that retitling their assets to be owned by the trust is a critical part of the process to ensure the trust will work as...

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You’ve Signed Your Last Will & Testament. Now Where Should You Keep It?

After signing your Last Will & Testament (“Will”), you may be tempted to not think about it again.  After all, thinking about your death and what will happen to your loved ones and your assets after you are gone isn’t the most fun thing to think about.  But before you move on, there’s one more important thing you need to think about: Where are you going  to store your original Will? Generally there are two options, you can either keep your original Will yourself or have a third-party hold it for you.  If you are planning to keep your original Will...

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The “School Supply” Your Child Should Not Head Off To College Without

Do you have a child heading off to college for the first time in the Fall?  If so, I’m sure you have been busy planning with your child to make sure they have everything they need to be ready for the big move: school supplies, clothing, food, and those personal touches that will make their dorm room feel at least a little like home.  But have you thought about making sure your now adult child has signed an Advance Directive?  Imagine this: In mid-August, you get your son settled in his dorm room at an out-of-state college. A few weeks into...

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Why You Should Say No To Online Estate Planning: You Get What You Pay For

In this modern day and age there are so many resources readily available to us online, it can be overwhelming.  Sure, you can “Google” anything and get so much information that your head will spin, but in the end, you don’t know what you don’t know.  How do you determine which sources are reliable and which ones are just a marketing tactic about what you supposedly need?  While the internet can sometimes be a good source of information, we all have to be mindful of the limitations of any online purchase. While it may be appealing to “pay less” to get...

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New Elective Share Law in Maryland Increases the Need for Prenuptial Agreements

In case you missed it because of all the other changes we had to deal with during the pandemic, there was a significant change to Maryland’s elective share law that went into effect as of October 1, 2020.  What exactly is the elective share and why should you care?  Simply put, the elective share is a surviving spouse’s right to file a claim (i.e. make an election) against their deceased spouse’s estate to inherit a portion of assets even if their deceased spouse has an estate plan that says otherwise.  This largely impacts Marylanders who are considering getting married again...

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If Your Will Was Remotely Witnessed During The Pandemic, Your Will May Be Deemed Invalid Upon Your Death!

In Maryland, any individual over the age of 18 who is legally competent can make a Last Will and Testament (“Will”). In order for a Will to be considered valid under Maryland law, it must be (i) in writing, (ii) signed by the person making the Will (the “testator”), and (ii) attested to and signed by two credible witnesses in the physical presence of the testator. Covid-19 resulted in many changes to how things were done.  On April 10, 2020, Governor Hogan signed an emergency order that temporarily suspended the requirement that a Will must be signed by the testator and...

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