"If you love life, don’t waste time, for time is what life is made up of." – Bruce Lee
Scattershooting around the tax world while simultaneously preparing for a sure-to-be-busier tax season (thanks for all the recent referrals — keep ’em coming!) AND navigating the perils of another holiday season … well, it means one busy Kevin!
Seriously, we’re getting excited about what is our most intense season of the year — TAX time. In between cookies and egg nog, we’re boning up on all of the official tax law changes, and meeting with clients for last-minute tax-planning.
A few quick tax items for you, in fact, before I get to the good stuff:
IRS might have some refund $$ for you: There’s $153 million unclaimed right now. So, if you were expecting a refund check and fear it might have been returned to the IRS as undeliverable, go to the IRS website (www.irs.gov) and use the "Where’s My Refund?" tool. This will give you the status of your refund. In some cases, it will also provide "instructions on how to resolve delivery problems." You can also can get a phone version of "Where’s My Refund" at (800) 829-1954.
A friendly reminder: Use those FSA funds in the next few weeks … or lose ’em! No explanation necessary, methinks.
Lastly — we have a couple last-minute tax planning appointments available! If you want to ensure that we’re maximizing your assets for MINIMUM tax liability, a phone or in-person meeting will make it happen. Shoot me an email, or give us a call: (502) 426-0000
Now… on to something which might just serve as a friendly nudge: "Tax time" is the perfect time for you to get other, long-delayed financial tasks accomplished. One of these is the dreaded estate plan. This is something which every family should have in place — not just the 1% (if you will). In fact, there are some myths about preparing estate plans which I thought we should deconstruct together, today.
(And as I mentioned — preparing to set up one of these plans is much easier in the context of what you normally do in preparing for tax season … so, let us know how we can help you with it!)
"Real World" Personal Strategy
Two Common Estate Plan Myths — BUSTED
As of this writing, it’s a fact that almost 60% of Americans don’t have a basic will, and that’s a big problem.
One of the big reasons that most families don’t yet have this kind of plan in place is because of some incorrect thinking about whether it’s right for them, or if it’s even necessary. And sure –some people just haven’t gotten around to creating a will or trust. Others think they don’t need an estate plan because they’re not "rich".
But here’s the problem–if you continue without an estate plan, you could leave a legacy of bad feelings and attorneys’ fees.
So I wanted to speak to some of the more common misconceptions out there. I’ll start with a couple big ones this week, and when the time is right, address a few more in 2012…
MYTH #1: Only rich people prepare estate plans.
Do you own ANYTHING? Because if so, you need a will. You see, a will allows you to designate who will receive your property should anything happen. Continuing without one ensures that your assets will be distributed under the terms of your state’s "intestate succession" laws. That means your money and property could end up with family members you haven’t spoken to in years, instead of who you’d really like to see control your assets.
I won’t go into all of the different components of a will, trust, health care directive etc., as my purpose here is to emphasize that failing to plan is simply a decision to trust your assets to government bureaucrats who don’t know you from Adam.
Even if you think your situation is pretty straightforward, you may feel more comfortable hiring a lawyer to guide you through the process.
MYTH #2: Everything goes to your spouse, if something happens.
Unfortunately, that’s not always the case. We deal with clients from different states around the country, and state laws vary. In fact, in most states, if you continue without a will (intestate), your inheritance will be divided among your spouse and your children. In New York, for example, when someone dies intestate, the spouse gets the first $50,000 of the estate and what’s left is divided 50-50 among the spouse and the children.
You can imagine how this could create all kinds of problems, particularly if your spouse was financially dependent on you or you have children from a previous marriage.
I’ll send a few more in the future, but I hope you can already see that things are not always as we "think". And let’s take advantage of tax season and move towards getting this done (or updated) in 2012!
I hope this helps! To your family’s financial and emotional peace…