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12 Point Estate and Wealth Protection Checklist For 2021

On Behalf of | Oct 12, 2021 | Estate Planning And Elder Law

Note:  Our firm is dedicated to helping families protect their hard earned wealth regardless of size – We provide basic estate planning for families with modest savings and advanced planning for those with substantial wealth.

1. Wealth Protection.  Do you have any rental real estate that is in your individual name or an S corporation?  Do you have a single member LLC?  This is low hanging fruit for any potential creditor, and likely needs to be protected by placing the property in a multi-member LLC (limited liability company) or LP (limited partnership).  Do you know which assets you own that are protected and which are exposed?   If not, we can help analyze this important issue. Schedule a Wealth Protection consultation by calling Ben at 269-948-7600.

Note:  While a living revocable trust is a powerful legal tool to avoid probate and keep legal control in your family, it does NOT protect your assets.  We have numerous legal strategies to help protect your wealth and make you an unattractive target for a lawsuit.

2.   Successor Trustee.  This is the person you have appointed to step into your legal shoes if you become incapacitated – in other words, one of the most important estate planning decisions you can make.  Who have you appointed to take charge if you are incapacitated? Do you trust this person 100%?  What is the order of succession of trustees?

3.   Family Transitions.  Has there been a marriage, divorce, or separation of anyone named in your will or trust?  Has there been a birth of a child or grandchild?  If so, your estate plan may need to be amended.

4. Estate Tax Review.  For those families that may have around $3 million or more in total wealth you need to take special note.  As you all know the Democrats took control of the Senate and House following the November elections.  On 03 21, 2021 Senator Bernie Sanders introduced the “For the 99.5% Act” that may increase estate taxes from 40% to 65% and impose a reduced estate tax exemption of $3.5 million (now $11.6 million but scheduled to drop to about $6 million in 2026) and reduce the gift tax exemption to $1 million.  The practical effect of this bill on families and small business owners is impossible to predict until actual legislation is passed – if at all – but all families with $3 million or more in total assets (including all life insurance) should consider scheduling an estate tax review with us.

5.     Non-Resident or Not U.S. Citizen.   If a person is not a U.S. citizen or non-resident, the tax rate is 40% over the exemption of $60,000.  Foreign investors who are non-residents and own property in the U.S. need to do special planning to avoid this tax.

6.   Durable Power of Attorney.  Check the date of your Durable Power of Attorney (“DPA”) in your portfolio book.

7.   Trust Funding.  Funding is simply the transfer of your assets into your trust.  If our firm drafted your trust, immediately after you signed your trust, we reviewed how your assets are titled and gave you detailed Funding Notes.  Have you followed up on these instructions?  It is a good idea to annually review the funding of your trust.

8.     Life Insurance.  When is the last time you checked (a) the owner of your life insurance policies; and (b) the beneficiary designations for those policies?  Some life insurance should be owned by an irrevocable life insurance trust to avoid the estate tax.

9.   Corporate Minutes.  If you have an incorporated business, when is the last time that you updated your corporate minutes?  For S corporations, it is important to keep annual minutes for income tax and asset protection purposes.  It is just as important to make sure that your minutes and certificate of ownership match what you report on your corporate tax returns.  Remember, the corporate veil can be pierced and your personal assets attacked if you do not follow basic corporate formalities.

10.   $15,000 Gift Allowance.  Do you wish to consider making gifts to family members to reduce your estate tax exposure?  Current law for 2021 allows you to make gifts of $15,000 per person per year ($30,000 if married) with little or no tax consequence to you or the recipient.  However, see the warning in Point #11 for gifts to minors

11.     Gifting To Minors – Big Mistake!  Making outright gifts to minors or naming a minor the beneficiary of anything without a trust can raise a host of unintended legal issues that may be costly to remedy.

12.     Health Care Surrogate.  If you have a child over 18 who is now in college it is highly recommended that he/she give you legal authority to make medical decisions on their behalf. Remember, once your child turns 18, he/she is an adult, and you have no legal authority to make any legal decision on their behalf.

Estate Plan Review.  Has it been more than three years since we sat down and reviewed your estate plan?  If so, we recommend that you schedule a meeting as soon as convenient to assess whether your plan continues to meet all the needs of your family.


To schedule an appointment to review or update your estate plan or the funding of your trust, call us at 269-948-7600 or email Ben at [email protected].   Now is the time to get this item off your 2021 Checklist!