August 2020 - Jim A Lyon Law Firm

Potential Estate Tax Changes Due to the 2020 Election

While the date of the 2020 election comes closer, estate planning lawyers are informing clients to anticipate the various changes to estate planning taxes that are likely to occur regardless of which candidate prevails. The following reviews some areas of estate planning that are likely to change following the 2020 Presidential election. Decreased Estate and Gift Tax Exemptions Even if it does not change due to a shift in political administrations, the existing estate and gift tax exemption of $11,580,000 will decrease in 2026 to the much lower amount of $5,000,000. This exemption could lower in 2021, however, as part of Democratic tax reforms. Similarly, the current generation-skipping tax exemptions are $11,580,000 and Vice President Biden has suggested that this amount could be lowered to $3,500,000 per individual. Increased Estate Tax Rates Since 2013, the estate tax has been 40%. Taxpayers who passed away in 2011 or 2012, however, utilized an estate tax rate of 35%. Not too long ago, in the early 2000s, the estate tax rate was between 45% to 55%. While the Democrat Presidential Nominee is likely to decrease the estate and gift tax exemption, it is also likely that additional tax reforms [...]

gstealth132020-10-05T17:39:13+00:00Tags: estate taxes|

Everything You Need to Know About Probate

Probate is a critical court-supervised proceeding that is utilized to take control of a deceased person’s estate. While Oklahoma has some nuanced laws regarding how probate proceeds in the state, the process still has the overall purpose of both authenticating and validating a person’s will and making sure that debts are paid. What Does Probate Mean? Probate refers to a court-controlled proceeding in which control is taken of a deceased person’s estate. The probate process refers to transferring ownership of a deceased person’s assets to beneficiaries. Some of the primary players involved with the probate process include: The executor or personal representative is tasked with administering the estate. These individuals help to make sure that assets in an estate are distributed according to a will. Beneficiaries are the individuals who inherit assets from an estate. Sometimes people who are not directly named in estate planning documents might also believe that they have a claim as beneficiaries. Creditors might be notified of the probate proceeding and can sometimes collect on debts that are owed by an estate. Understanding How the Probate Process Works After a person’s death, a surviving loved one will likely need to collect [...]

gstealth132020-09-10T02:10:50+00:00Tags: oklahoma city probate attorney|

How to Anticipate Tax Changes with a Potential Administration Change

In a Wall Street Journal article published last month, Philip DeMuth commented that Americans currently live in an ideal age of taxes due to President Trump’s 2017 Tax Cuts and Jobs Acts. Unfortunately, however, the tax advantages offered through various regulations passed by the current administration are scheduled to end on December 31, 2025. Potential Changes to Estate Planning Laws It is a good idea to review each estate planning during such uncertain times to make certain that assets are not placed at risk of unnecessary taxation. Some of the potential changes that could occur include: Increasing the maximum estate tax rate from 40% to 77% Placing substantial limits on estate planning techniques like Grantor Retained Annuity Trusts and Defect Grantor Trusts Reducing estate and gift taxes as well as generation-skipping transfer tax to $3,500,000 from $11,580,000 Restricting the $15,000 annual gift exclusion afforded to unlimited donees to only two donees a year Even though it can be difficult to predict what regulations might be passed into law, due to both the significant federal deficit and current political government, at least some of these regulations are likely to come to pass. Estate Planning Techniques During [...]

gstealth132020-08-19T03:02:17+00:00Tags: bankruptcy, estate planning, finances, taxes|

Appreciating the Importance of Medical Directives During the Pandemic

As the coronavirus pandemic continues throughout Oklahoma, many people are faced with the question of whether their estate plan is sufficient. While many people think that a will is sufficient, it is often important to create other critical estate planning documents. During these times, it is helpful to consider whether a “living will” or “medical directive” is a suitable estate planning tool to create in case you ever pass away or become incapacitated. The Difference Between Living Wills and Medical Directives Living wills serve the purpose of reflecting what or whether or a person would like to receive life-sustaining procedures. Living wills are classified as only one type of advance directive, which directly focuses on measures required to sustain a person's life. Some of the other types of advance directives include a wide range of alternative planning options. Living wills fall into the category of medical directive, which refers to documents establishing a person’s wishes for certain medical procedures as well as end-of-life care. While the term “advance directives” is often used in relation to these documents, this often refers to power of attorney documents that assign another individual’s ability to make financial or medical decisions. [...]

gstealth132020-08-19T03:00:00+00:00Tags: advance directive, estate planning, living wills|