Author Archives: Robert Mondo

Clients spend lots of time, money, and energy planning their estates. Estate Planning attorneys help them by counseling these clients and preparing various documents to meet the goals of the client, such as a Will or Trust.

An increasing part of American wealth is governed by beneficiary designations. According to Statista, Americans had over $32 trillion in retirement assets alone. That’s trillion with a “t.”

This post examines “eligible designated beneficiaries” who are exceptions to the standard 10-yr rule of the SECURE Act. The next post will examine how beneficiary designations done prior to the Act might not work as intended after the Act.

As examined in the prior posts, under the SECURE Act a beneficiary typically must take all distributions by the end of the year which includes the 10^th anniversary of the Participant’s death. However, not all beneficiaries are covered by this requirement of a more rapid distribution. Some beneficiaries are “eligible designated beneficiaries,” otherwise known as “EDBs.” An EDB could take distributions based on their own life expectancy, just like prior to the SECURE Act.

EDBs under the Act are:

1. The surviving spouse of the Participant. (The surviving spouse could also do a spousal rollover and thereby consider the assets as in their own retirement plan, like under prior law.)
2. The child of the Participant under the age of majority. However, once the child reaches age of majority, they fall under the general 10-year rule of the SECURE Act. It’s important to note that a minor child of someone else, such as a grandchild, niece, or nephew, is not an EDB.
3. Someone less than 10 years younger than the Participant,
4. Someone who is “disabled” (within the meaning of Section 72(m)(7) of the IRC), or
5. Someone who is “chronically ill” (within the meaning of Section 7702B(c)(2) of the IRC)

Note that the disabled or chronically ill beneficiary must meet the definitions as of the death of the Participant in order to be an EDB.

A trust for the benefit of an EDB also qualifies as an EDB. However, with the exception of a disabled or chronically ill beneficiary, the trust share of the EDB must be named directly and that trust must be a “conduit” trust.

After the SECURE Act, planning to stretch retirement plan distributions is much more difficult. One way to do it is to have retirement assets go to an EDB, such as a disabled beneficiary, and other assets go to other beneficiaries.

However, one group of EDBs is rather illusory. The minor child of the Participant is an EDB, however, they lose their EDB status upon adulthood and fall under the 10-year rule. Therefore, if the child of the Participant is the beneficiary, they’d have all the assets typically at age 28. Often, clients would prefer not to have their retirement assets go outright to their children at an age when they may not have suitable discretion. Unfortunately, leaving the assets in a trust for the child’s benefit won’t help because, by its nature, a conduit trust would give the beneficiary control or access to the funds upon distribution from the retirement plan. Again, that means the Participant’s child would have control of the assets at age 28.

Beneficiary designations can be deceptively simple. Just beware the rest of the iceberg.

Clients spend lots of time, money, and energy planning their estates. Estate Planning attorneys help them by counseling these clients and preparing various documents to meet the goals of the client, such as a Will or Trust.

An increasing part of American wealth is governed by beneficiary designations. According to Statista, Americans had over $32 trillion in retirement assets alone. That’s trillion with a “t.”

The SECURE Act passed in December 2019. First, the SECURE Act changes the age for lifetime Required Minimum Distributions (“RMDs”) from age 70½ to age 72. This change is generally good for savers since it delays the date at which distributions must be taken from retirement assets. This is helpful in two ways. First, it allows the assets to grow tax-deferred. Second, for that additional 18 months from 70½ to 72, the account holder won’t have the tax liability of the distributions.

Once the owner of the IRA (the “Participant”) reaches that age (their “Required Beginning Date”), generally they must take out distributions under the Uniform Table, which represents the joint life expectancy of someone their age and a fictitious spouse 10 years younger (whether or not they are married). If they have a real spouse who is more than 10 years younger, they’d use a joint life expectancy using the real spouse’s age.

The biggest change of the SECURE Act concerns the rules for distributions by those whom the Participant names as the beneficiary to receive the assets after the Participant’s death. Prior to the Act, non-spousal beneficiaries could take distributions based on their own single-life expectancy. So, the younger the beneficiary, the longer the permitted distribution period.

Often, attorneys would advise clients to name the youngest beneficiary possible to get the maximum stretch. For example, if the client/Participant named their newborn grandchild, the distributions could be stretched over more than 82 years!

Generally, it’s better to defer retirement plan distributions as long as possible. Deferring distributions allows the assets to grow tax-deferred (or tax-free in the case of a “Roth” account).

Under the SECURE Act, non-spousal beneficiaries must withdraw all the assets by the end of the year which includes the 10^th anniversary of the Participant’s death. Under prior law, the beneficiary could take distributions each year over the beneficiary’s life expectancy. So, this is a much more rapid distribution of the retirement benefits.

Let’s look at an example:

John dies leaving $1 million to his daughter, Beth, who is 25 years old. John dies in February 2021. The SECURE Act applies to the distributions to Beth since John died later than December 31, 2019. The 10^th anniversary of John’s death occurs in February 2031. Beth doesn’t need to take any distributions for the first 10 years, but she needs to take everything by December 31, 2031.

As a practical matter, often the beneficiary won’t want to wait until the last possible date to take all the assets. If they waited until the final year, all of the income from the distributions would be taxed in that one year. Often, it’s better to spread the income over several years in order to obtain a lower marginal tax rate.

Beneficiary designations can be deceptively simple. Just beware of the rest of the iceberg. The next blogs in this series on beneficiary designations will examine the exceptions to the SECURE Act’s 10-year rule and how beneficiary designations which might have been ideal before the SECURE Act might now have unintended consequences.

Clients spend lots of time, money, and energy planning their estates. Attorneys help them by counseling these clients and preparing various documents to meet the goals of the client, such as a Will or Trust.

All too often a client forgets to mention and the attorney forgets to ask about assets that pass via beneficiary designations. This could be disastrous for all concerned.

An increasing part of American wealth is governed by beneficiary designations. According to Statista, Americans had over $32 trillion in retirement assets alone. That’s trillion with a “t.”

Experienced Estate Planning attorneys know there can be a great deal involved in deciding to whom the retirement assets should go and how. But let’s look at a simple example of a retirement plan designation screw up.

John was married to Betty. John had a small IRA on which John had named his mother as the beneficiary many, many years ago. John didn’t think much about the IRA. It only had $30,000 and he hadn’t touched it in many years. He also had a retirement plan at work which had several hundred thousand dollars. The retirement plan at work named Betty as the beneficiary.

John and Betty consulted an Estate Planning attorney who helped them with a plan leaving everything to the survivor of them with appropriate distributions to their children after the death of the survivor of them. The small IRA would still go to John’s mother.

When John retired, he was considering what to do with his retirement plan. He was frustrated by the investment options available under his work retirement plan. He knew an IRA had much more flexible investment options. So, John did a rollover of the retirement plan into his IRA.

John had forgotten that he had named his mother as the beneficiary of his IRA. The assets which had been in his retirement plan, which comprised the bulk of his assets, now would go to his mother instead of his wife at his death. Worse yet, while Betty had assets of her own from her employment, John’s children likely would lose out on the bulk of the assets going to his mother. His mother had 35 grandchildren and her estate plan left assets to them equally.

This beneficiary designation snafu thwarted the planning which had been done for John’s assets. Maybe John’s mother would agree to give the assets to John’s widow and children. But maybe she would not or could not due to incapacity. This highlights the need to examine beneficiary designations each time there’s any change. It also highlights the need to examine beneficiary designations periodically, when the plan is reviewed.

The Estate Planning attorney in this situation might get dragged in through no fault of their own. However, if they miss this designation snafu upon a review, they could have increased liability. It’s a best practice to get a copy of the beneficiary designation on each such asset and provide it to your attorney. Client’s often forget the designation they made because it could have been years earlier.

Beneficiary designations can be deceptively simple. Beware of the rest of the iceberg.

Sometimes people use Joint Tenancy as a simple way to do Estate Planning. This can have drawbacks, sometimes serious and unexpected.

First, why is Joint Tenancy a simple way to do Estate Planning? At the death of a joint tenant, the property automatically transfers by operation of law to the remaining joint tenant(s). This can be attractive because it bypasses the probate process and all it entails. Probate is the process that moves property titled in the name of one person (the decedent) and moves it to the name of another person. Probate is a public process, lacking privacy. Depending upon the state, probate can be costly and time-consuming. With Joint Tenancy, probate isn’t required because it passes by operation of law by its very nature.

However, if a couple wants to avoid probate, while Joint Tenancy avoids probate at the death of the first joint tenant, it doesn’t avoid probate in the estate of the survivor. At the survivor’s death probate would be required unless further planning is done. The problem is the survivor may be unable to plan because of grieving, incapacity, or simultaneous death.

Let’s look at a quick example. John and Mary own their home in Joint Tenancy. This seems to work well for them for years. Driving home from work one day, John has a heart attack and dies. The property transfers by operation of law to Mary. However, Mary’s now distraught from John’s death and puts off planning for the property. Mary dies with the property in her name and a probate is required. Of course, if John and Mary had died in a common accident, probate would have been required, too.

However, there could be more serious problems with Joint Tenancy. Let’s say that Mary in our example above did further planning by adding John and Mary’s only child, Josh, as a joint tenant. While this would avoid probate at Mary’s death, just as it did at John’s death, it causes other issues.

Josh could decide to sell his half of the property. Of course, Mary says he would never do that. Maybe he wouldn’t, voluntarily. However, let’s say Josh is sued and they get a judgment against him. They can satisfy it against any of his assets, including his ownership interest in the property he holds in Joint Tenancy with Mary.

So, in addition to the risk that Josh might not cooperate or could make Mary’s life difficult, his actions could cause Mary to lose the half of the property in Josh’s name to Josh’s creditors. While Mary was trying to save a little money by putting the property in Joint Tenancy, she jeopardized her future.

There are also tax consequences with adding a non-owner to an asset as Joint Tenant. The original basis is assessed to the surviving Joint Tenant upon sale of the asset. In essence, there is no step up in basis for the asset. In this scenario, Joint Tenancy just bought the surviving Joint Tenant a date with the capital gains tax people.

If John and Mary had utilized a Revocable Trust instead of Joint Tenancy, the property would have avoided probate. If Mary hadn’t compounded the problem by trying to use Joint Tenancy with Josh, she could have avoided losing half the property to Josh’s creditors and avoided capital gains taxes.

Trusts are very useful, flexible tools to hold assets. They allow for management of assets during your life, upon your incapacity, and for the continued management of the assets after your death. Perhaps you’d continue to hold the assets in trust until your children reach a suitable age to manage the money for themselves, like age 25 or 30. But you could keep the assets in trust even longer. You could keep the assets in trust for the lives of your children, and your children’s children, and so on.

These trusts, sometimes called “Dynasty Trusts” continue for the longest possible time allowed by law. Some states have a “Rule Against Perpetuities.” The Rule in common law says that the asset must vest, if at all, no later than 21 years after the death of a “life in being” when the trust became irrevocable, typically the death of the grantor of the trust. In jurisdictions with the common law Rule Against Perpetuities, you could have the assets in the trust and then at your death, you’d look around and see who is the “measuring life.” Typically, the measuring life is the living beneficiaries of the trust, like your children and grandchildren. The trust must distribute within 21 years of the death of the last of them to die. Let’s say at your death your grandchild is 4 and lives until their 104^th birthday. The trust can continue until 21 years after that. So, the trust could continue 121 years in that case.

Many states have adopted the Uniform Statutory Rule Against Perpetuities, which allows a trust to last either the traditional Rule Against Perpetuities period (a “life in being” plus 21 years) or 90 years, if longer. Some states have modified the Rule so that a trust might last 150, 365, or even 1,000 years. Some states have completely repealed the Rule so that a trust could last forever!

Why might you want to keep your assets in a trust that long? First, you can have professional management of the assets to make sure the assets aren’t squandered by the beneficiaries and make sure the assets are distributed in the manner you’ve chosen even long into the future.

Next, a Dynasty Trust can save on taxes for those with a taxable estate. Let’s look at a quick example:

John (age 80)(1st generation) dies and leaves $5 million to his daughter, Sally (age 50)(2^nd generation), outright. Sally lives another 30 years and the $5 million grows at 7.2%. The $5 million turns into $15 million by Sally’s death. Sally was a prudent investor and had a taxable estate in her own right even before inheriting from John. Therefore, the inheritance from John and the growth on it are all taxed at the estate tax rate, which is currently 40%. Sally’s estate pays $6 million of estate tax on the money and Sally leaves the $9 million inheritance to her child, Beth (3rd generation), who’s also very savvy with investments and has a taxable estate in her own right. Beth lives another 30 years and the $9 million she inherited from Sally triples to $27 million. Beth’s estate pays an estate tax of 40%, or $10.8 million. Beth leaves the inheritance to Josh (4^th generation), who invests similarly. So, the $10.8 million he inherits grows to $32.4 million and his estate owes tax of $12.96 million, leaving $19.44 million for future generations. So, by the end of the 4th generation, the $5 million inheritance from John has grown, after transfer taxes, to $19.44 million in 90 years. That’s not bad, it’s nearly quadrupled.

But there is a better way. If at his death John (1st generation) left the $5 million to a Dynasty Trust for the benefit of Sally (2nd generation) and her descendants and allocated his GST exemption, the assets wouldn’t have been included in Sally’s estate. At Sally’s death, the $15 million wouldn’t have faced a 40% reduction due to the estate tax. Instead, the full $15 million could have continued to grow for the benefit of Beth (3rd generation) and her descendants. After 30 more years it would have tripled to $45 million and at Beth’s death, it wouldn’t have been reduced but would have passed to Josh without further estate taxes. After another 30 years of prudent investing by the 4^th generation, the inheritance would have grown to $135 million.

Without a Dynasty Trust, the assets increased by 4x. However, with a Dynasty Trust, the assets went up by 27x over the same period of time and with the same investment assumptions. While a Dynasty Trust isn’t for everyone, it can have some transfer tax advantages for those with a taxable estate. 

The estate tax exclusion is the amount you can give without facing an estate tax. Under current law, you may give this amount during life or at your death and after that amount is used, you face a federal tax of 40% on assets beyond that amount. The amount has fluctuated a great deal over the years. It was $675,000 as recently as 2001. In 2021, the exclusion is a whopping $11.7 million per person. This exclusion consists of a “permanent” exclusion of $5 million, adjusted for inflation since a 2011 base year, and then temporaril doubled through 2025 as a result of a 2017 law. So, unless Congress acts to extend the doubled exclusion, it will revert to $5 million adjusted for inflation beginning in 2026. Confusing, isn’t it?

However, Congress could act sooner than 2026 to reduce the exclusion. Congress has tinkered with the estate tax many, many times over the decades. So, this would be nothing new.

Proposals from the Biden campaign indicated a desire to reduce the estate tax exclusion to $3.5 million. Such a proposal would need to pass through the House of Representatives, which Democrats control by a narrow majority of 222 seats to 211 seats held by Republicans, with 2 seats currently vacant. Assuming legislation to reduce the estate tax exclusion were to pass through the House, it would then proceed to the Senate.

At the beginning of January, the Senate consisted of 50 Republicans and 48 Democrats (and independents caucusing with the Democrats) and two seats pending runoff elections in Georgia. Beating long odds, Democrats won both those runoff elections in Georgia, so the Senate is now tied 50-50. This means the Vice President casts the tie-breaking vote in the Senate. Prior to January 20, 2021, Vice President Mike Pence enables Republicans to retain the majority. However, on January 20, 2021, Vice President-Elect Kamala Harris will be sworn in as Vice President and the majority in the Senate will shift to the Democrats.

Thus, beginning January 20, 2021, Democrats will have the narrowest of majorities in the House and Senate. Even with a narrow majority, there are hurdles to passage in the Senate. Senate rules require 60 votes to end debate on most matters. Also, it’s not at all certain every Democrat would agree, as they’re often a fractious caucus.

But, with deficits mounting, Congress may seek to raise revenue from many sources, including reducing the estate tax exclusion. Why wait to see what Congress does? Your best chance of taking advantage of the current unprecedently high exclusion is to use it now.

If you’re married, you could give assets in the amount of your remaining exclusion to a trust for the benefit of your spouse and/or descendants. Your spouse could be the trustee of the trust and would have the ability to use the assets for their support. If you’re unmarried, you could give your assets to a trust for the benefit of your descendants.

January’s political events have altered the political landscape substantially. Consider whether taking advantage of the current estate tax exclusion is right for you.

Welcome to the dawning of 2021! Most of us will leave 2020 without any hesitation. 2020 was not the best year for most of us. But you have an opportunity to start 2021 prepared for anything. You can do the responsible thing and get your estate plan in order.

The tumultuous events of 2020 show just how important it is to have your planning in order. Millions became seriously ill from the coronavirus. All too many of them died. When they became ill, those who had their estate plan in order could focus on more important things, such as spending precious time with loved ones.

Even as we hope 2021 will be much better than 2020, it’s important to start out right, by putting an estate plan in place.

What’s an estate plan? At its most basic, it’s a set of instructions about how you want your affairs handled if something happens to you. It’s a message that shows your loved ones you care. A basic estate plan includes a Healthcare Power of Attorney, a General Durable Power of Attorney, a HIPAA Authorization, a Will, and typically also a Trust.

First, what’s a Power of Attorney? It’s a document by which you appoint someone as your “Agent” to act on your behalf. If that Agent is unwilling or unable to act, the document can appoint one or more successor Agents. In other words, you give someone else (the Agent) powers you inherently already have yourself. With a Financial Power of Attorney, otherwise known as a General Durable Power of Attorney, you appoint your Agent to make financial decisions for you. The Power could be drafted to be “immediate.” In other words, the Agent would have the power to make decisions regarding your financial assets right away and without regard to your ability to make those decisions for yourself. In most states, you could make the Power “springing,” in other words it would only become effective upon you not being able to act for yourself because of incapacity. A Power of Attorney is “durable” if it continues notwithstanding you having incapacity. A Power of Attorney which is not durable would not allow your Agent to act during your incapacity.

A Healthcare Power of Attorney appoints an agent to make medical decisions for you when you are unable to do so for yourself. A HIPAA Authorization appoints an agent to access protected health information.

It’s important to keep your Powers of Attorney up-to-date so that you have the people you want as your agents. The agents you select under your Powers of Attorney are vital to your incapacity plan. Make sure you keep the right people in those roles.

Without a Will, the assets titled in your name go as set forth in state intestacy law. This typically is not exactly how you would like. A Will allows you to select to whom and how you want your assets to go. It also allows you to name who you would like to handle your estate after your death. If you have minor children, your Will allows you to nominate guardians to care for them.

Both intestacy and a Will are subject to a public probate proceeding. Depending upon the state, this can be a lengthy and costly process. If you want to avoid probate and maintain your privacy, you can use a Trust. With a Trust, you transfer the assets to the Trust during your lifetime and can manage them as the Trustee. This allows you to avoid the probate process since the Trust doesn’t die. The Trust has the added benefit of making incapacity even easier. Due to cases of fraud, often institutions more readily recognize a successor Trustee acting on your behalf than an agent under your power of attorney.

Hopefully, 2021 will be better than 2020. Even a basic estate plan will allow you to face whatever 2021 has in store for you. Resolve now to get your estate planning done this year, sooner rather than later.

As 2020 draws to a close and a new year dawns, we need to think of…tax planning! Some years Congress tweaks the laws more than other years. While 2020 held plenty of surprises with coronavirus and an election, it was a relatively quiet year for legislative changes. Still, even in a quiet year, some things change due to inflation increases, etc.

Estate Tax Planning

Applicable Exclusion rises from $11.58 million in 2020 to $11.7 million in 2021.

GST Exemption rises from $11.58 million in 2020 to $11.7 million in 2021.

Annual Exclusion for present interest gifts remains at $15,000.

Annual Exclusion for gifts to a Noncitizen Spouse rises to $159,000 in 2021.

In a few years, at the end of 2025, the Applicable Exclusion and the GST Exemption will revert to one-half of their current levels, in other words to $5 million, adjusted for inflation from the 2011 base year. This isn’t relevant for most Americans. However, if you have well over these amounts, you may want to consider removing these amounts from your estate while you still have the Exclusion and Exemption to cover the transfers. You still have a few years before the law is set to change, unless Congress changes things dramatically before then.

Income Tax Planning

Standard deduction amount:

Married, filing jointly, increases from $24,800 in 2020 to $25,100 in 2021

Single, increases from $12,400 in 2020 to $12,550 in 2021

Head of household, increases from $18,650 in 2020 to $18,800 in 2021

State and Local Tax (SALT) deduction cap remains at $10,000 in 2021

The income tax brackets also creep slightly higher, as well.

As you plan for 2021, remember to keep your receipts for expenses and charitable contributions. With the high standard deduction amount and the cap on State and Local Tax deductions remaining at $10,000, fewer taxpayers are itemizing. In fact, the percentage of taxpayers itemizing is less than half what it was before the Tax Cuts and Jobs Act of 2017. Now, less than 14% of taxpayers are expected to itemize. Before then, over 31% of taxpayers itemized. If you give to charity, you may want to group your charitable contributions into one year and itemize them in that one year. You can do this by giving to a donor-advised fund in one year. Then you can make grant recommendations from your donor-advised fund each year. This way, your tax planning won’t impact your favorite charities.

Let’s look at an example. John and Mary make $14,000 of charitable contributions to their church or alma mater each year. They have state and local tax deductions above the $10,000 limit. They have a total of $24,000 of deductions and they’d be better off taking the standard deduction ($25,100 in 2021). Rather than giving $14,000 for each of three years to charity, they could give 3 x $14,000 ($42,000) in one year and they’d get a much better tax result. If they gave $42,000 in year 1 to a donor-advised fund, combined with their SALT deduction of $10,000, they’d have $52,000 of deductions instead of the standard deduction of $25,100. In years 2 and 3, they’d just have the SALT deduction of $10,000 and no charitable deduction but could still take the standard deduction ($25,100 in 2021). The charities would get their funds each year just as usual. John and Mary would get a much better tax result. In year 1, they’d have $52,000 of deductions instead of $25,100, an increase of $26,900. Their deductions in years 2 and 3 would not change. If John and Mary are in the highest income tax bracket, this increased deduction could save them nearly $10,000 in taxes.

A little planning can produce a much better tax result. Have a happy, healthy, and prosperous 2021!

A beneficiary designation instructs where the asset goes upon your death. Some important assets which transfer by beneficiary designation are IRAs, 401(k)s, and life insurance. These assets could be a large part of your overall assets, so it’s important to make sure those beneficiary designations complement your overall estate plan. These designations control the disposition of the asset, notwithstanding the fact that your Will or Trust has terms that conflict with it. For example, let’s say your Will or Trust leaves everything to your two children. However, you have an asset, like an IRA, which designates your mother as the beneficiary. Perhaps the designation predates the birth of your children. In that scenario, your IRA would go to your mother and not to your two children. That’s why it’s important to check beneficiary designations on assets that have them.

Many other assets, such as a bank account or a brokerage account could have a “POD” (Pay on Death) or “TOD” (Transfer on Death) designation. Like a beneficiary designation, a POD or TOD designation supersedes the instructions which you’ve laid out in the rest of your estate plan, such as in your Will or Trust.

There’s nothing inherently wrong with TOD, POD, or beneficiary designations. When used properly, they can be a simple, effective part of your overall plan. However, it’s important to coordinate your entire estate plan and consider the impact of each part on the other.

It’s easy for a plan to become inconsistent with your wishes when you use beneficiary designations, TOD, or POD because the designations are fixed even as asset values change. For example, let’s say Mary intends to leave her assets to her three children equally. Mary has a small brokerage account with a POD to one of her children, Betty. Mary doesn’t think anything of this, because there’s language in her Trust which considers what Betty receives from the brokerage account. However, when the brokerage account going to Betty skyrockets in value, Mary’s Trust can no longer make sufficient adjustments because it doesn’t control sufficient assets to balance out the brokerage account going directly to Betty.

However you choose to leave your assets, it’s important you consider changes in your wishes, changes in asset values, etc. If you want your wishes carried out, it’s important to keep your entire plan up-to-date and consider how changes in asset values might have a substantial impact on your plan.

Every state has laws controlling what happens to your assets if you die owning them in your name and don’t leave instructions indicating what you want to happen to those assets. Those laws are called “intestate succession” laws. While they are designed to cover what people will want generally, they often aren’t what you want to happen in your precise situation. For example, state law might leave the assets equally to your children outright. You may prefer unequal shares for your children due to your situation. Also, you may prefer to have the assets held in trust. For example, a beneficiary might have special needs and an outright distribution could deprive them of needs-based benefits. A will is how you leave instructions to override the intestate succession laws. If you have assets in your name at death, they will be subject to probate and will be controlled by your will, if it exists, or intestate succession.

However, you can have your assets owned by a revocable trust. If you do that, your assets won’t be in your name at death and they won’t have to go through the probate process. The probate process may be more or less expensive and time-consuming depending upon the jurisdiction. But, it’s almost always a public process. A revocable trust allows for streamlined management of your assets. While you’re alive and well, typically you’d be the trustee, in other words, the person managing those assets. Upon your incapacity, the person you’ve chosen as your successor trustee would step into that role. This incapacity protection can be invaluable. It’s much easier than if you don’t have a trust holding your assets.

Whether you’ve chosen a will or a trust as the engine of your estate plan, it’s important to re-examine your plan periodically to be sure it’s doing what you want. Are you comfortable with the successor trustees who would take over in the event of your incapacity? Are you comfortable with who would get your money, when, and how?

Many things can happen in the course of a year. This is especially true in a year like this one! It’s good to take a look at your plan and make sure it’s still consistent with your wishes.