Planning ahead for what life has in store for us provides a good foundation. And … planning is an ongoing necessity! The best laid (and made) plans are impacted by multiple variables and today, I’d like to share a few examples.
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Life Changes
Reviewing plans regularly is highly recommended. Especially when there are changes in marital status (marriage or divorce), the birth of children or grandchildren, the death of a family member, and changes in financial status. When these life-changing events happen, reviewing the estate plan will allow you to make sure it is aligned with your current wishes.
Asset Changes
When the value of your assets increases or decreases significantly, it is a good idea to review the implications of your taxes. This is the time to adjust estate plans to optimize tax savings, asset protection, or charitable giving.
Another time to review your planning is when acquiring or selling a business or investment. This is the time to review updates to your estate plans and/or succession plans to document your wishes.
Legislative Changes
Legislative changes are always something to pay attention to. On July 18, 2024, the Department of the Treasury and the Internal Revenue Service issued final regulations updating the required minimum distribution (RMD) rules.
The final regulations reflect changes made by the SECURE Act and the SECURE 2.0 Act impacting retirement plan participants, IRA owners and their beneficiaries. At the same time, Treasury and IRS issued proposed regulations, addressing additional RMD issues under the SECURE 2.0 Act.
There are new reporting requirements about digital assets reported this month. The IRS issued the following:
- Notice 2024-57, brokers are not required to file information returns and furnish payee statements for certain digital asset transactions identified in the notice — until further notice.
- Rev. Proc. 2024-28, which, subject to certain requirements, generally permits taxpayers to rely on any reasonable allocation of units of unused basis to a wallet or account that holds the same number of remaining digital asset units based on the taxpayer’s records of such unused basis and remaining units. The allocation must be a reasonable allocation as defined in Section 5.02 of the revenue procedure and must be made as of Jan. 1, 2025.
States Can Change Laws
It’s wise to pay attention to state law changes impacting estate planning. There are state-by-state differences, so it’s important you pay attention to the laws of your state of residence. Check out the background of Estate Planning Attorneys in your state through your local State Bar Association.
Third-Party Changes
It’s a good idea to think about and track the policies of third parties with whom you do business. Think about where you bank, invest, hold policies, and contracts you have. These third parties often have “rules” written and unwritten that can have a big impact.
Consider reviewing third-party communication annually and keeping everything filed in such a way that others can locate them if needed.
So Much to Consider
Navigating all the moving pieces in life is no easy task. There is so much to consider and when you’re not familiar with this topic, it’s difficult to plan and keep things straight.
Making time to assess what’s what at home and work allows you to focus on what’s important to you and those who count on you daily. It’s not always easy to carve out time, I know!
Breaking things down into smaller tasks helps a lot! For those who prefer a step-by-step 12-Module DIY method: Check it out HERE.
For a big picture Pre-Planning, What to Do at a Loss, and Ongoing follow-up considerations, my book The Living Planner (What to Prepare Now While You Are Living) is a resource for you. Here is a direct link to my shopping cart. Check it out HERE.
Let me know when you’re ready. This quote spoke to me this week, “The only person you are destined to become is the person you decide to be.” — Ralph Waldo Emerson.
Have a great week ahead ❣️Lynn
#Can’tPredictCanPrepare #PlanfortheUnplanned