When a person dies, distributing his or her estate can be a complicated process. Attorneys and financial planners here in Louisiana advise people to have a will to ensure that an estate is handled in the way the deceased person would have wanted it to be. Families or other beneficiaries may need a copy of a person's will, but the method of obtaining it depends on certain factors. Wills filed for probate have to be handled differently than those that have not been filed.
There is an old adage that says don't put all of your eggs in one basket. According to some financial experts, the same could be said about the assets of each spouse in a marriage. Louisiana residents who have tied the knot, don't have to have all their assets tied together and estate planning can be reflective of that. Keeping some things separate might also be wise when planning for unforeseen events like divorce.
Nobody likes to talk about end of life issues. But for estate planning to be truly successful, Louisiana residents need to have heart-to-heart conversations about their plans with their loved ones. And it's not only about who will be getting what; it's also about what the individual making the plan wants regarding medical treatment when he or she is incapacitated and unable to make those decisions. There are some ways to get the dialogue going.
When Louisiana parents have a child with special needs, they may be able to provide that child with the services and medical care necessary only with the assistance of certain government programs. However, to qualify for these programs the child can only own assets with a total value under $2,000. A child may become ineligible for that critical assistance if his or her financial worth exceeds that amount, such as if the child receives an inheritance. This is why many parents create special needs trusts for their children who depend on such programs.
Many people have an estate plan that contains a will and other documentation for handling finances. They often think that this is enough, since those documents generally dictate how to handle a person's estate. However, experts say that far too many estate plans, here in Louisiana and around the country, are missing a key component. About two thirds of estate plans do not have a health care directive. What exactly is a health care directive and why is it so important?
Newly single individuals have a lot to think about. It's likely Louisiana residents who have recently divorced or separated from their partners or recently widowed aren't giving much thought to estate planning, but that may be a big mistake. Single people need estate plans as much as their married counterparts. When a spouse dies, an existing estate plan may just need updating, but if a person divorces, that's a whole different story.
There are things most people would like to keep private. Estate planning is likely one of them. There are ways to keep estate plans private in Louisiana. The first thing to know is the differences between wills and trust-based estate plans. Wills have to go through the probate process and, as such, become public record once they're filed in probate court, and that means anyone can go in and ask to see the contents of any will on record.
Making the decision to write an estate plan is a wise one. However, Louisiana residents who have made that decision would be well-advised of a few potential faux pas to steer clear of when in the throes of estate planning. No one likes to plan for his or her demise, but to minimize the impact on family members, doing it the right way is crucial.
Prior to this year, financial planning during divorce was fueled by the alimony deduction. That all changed for divorces finalized after 2018 with new laws prohibiting payors of alimony -- including those in Louisiana -- from deducting those payments on their tax returns at the federal level. Essentially, this means, although the person paying alimony will owe more taxes, he or she may pay less alimony, while the payee won't be taxed on those payments but may receive less in support payments, and there are still ways to minimize taxes.
One of the most important things people want to accomplish when writing their estate plans is to keep the family peace. There is nothing that may cause Louisiana parents more upset than to think their estate planning decisions have caused a rift among their children. One of the best ways parents may be able to keep everyone happy -- in addition to having a comprehensive estate plan -- is to have open and honest conversations with children who will inherit their assets.