Year-End Checklist
As we enter the last few months of 2022, we want to remind you that it’s a great time to start thinking about ways to end your year strong so you can truly celebrate over the Holidays. Here’s a brief checklist:
- Annual Gifting. With the lifetime estate and gift tax exemption amount still at all time highs, many are not giving much consideration to the Estate Tax that can consume 40% of the asset value that exceeds the Exemption Amount. However, the only Exemption Amount that applies for the Estate Tax is the one for your year of your death, which is not yet known. It’s very likely this exemption amount will both increase and decrease before you die. Therefore, consider whether Annual Giving to children or grandchildren makes sense. Annual exclusion gifts are not subject to gift tax and fall completely outside of the unified tax system making it a valuable estate planning component. Currently, the annual exclusion amount is $16,000 per child, or $32,000 for a married couple (choosing to split gifts) per child.
- Review Your Estate Plan. As each year passes, circumstances change. Before you get too deep into Holiday travel, we recommend reviewing the key areas of your estate plan to ensure that it still meets your needs and aligns with your goals. Here at Stewart Law, we provide clients with a one-sheet diagram that serves as an Estate Plan Overview, including their assets, disposition, and named fiduciaries. It’s a good time of year to review not only this information but also your beneficiaries named on life insurance policies and retirement accounts. You should also see that assets are titled properly. We are always happy to have a consultation about these items and any tax law or other legal changes that could have ramifications for your plan.
- Corporate “Clean Up”. With so many other “To Do” items on a business owner’s list, many times we see a tendency of falling behind in ensuring the corporate records are not only in good standing with the Secretary of State, but also in good order internally. All too often this comes to light when businesses are looking at bank financing, a potential sale, or simply needing to have the appropriate persons sign an important legal document. While there are many good reasons to do it, a well-ordered and organized corporate minute book is a must for every business over the long term.
- Children’s POAs. As we draw nearer to the Holidays, we want to remind you that this is a great season for your child(ren) off at college to utilize their time at home by getting Powers of Attorney in place. Recall that in North Carolina minors become adults at age 18 and need to provide for their own legal planning. Accordingly, please take this time to ensure peace of mind when your child(ren) are back from school by letting Stewart Law help them with legal documents memorializing the persons who will make financial and health care decisions for them in case of a temporary incapacity.
- Family Meetings. Families benefit significantly from knowing there is a plan in place to protect the family’s lifestyle, even in case of an incapacity or death. In fact, over the last several years we have found that introducing your children to your advisor team and letting your family know that you have thought about, and have a plan for, their long-term wellbeing provides an increased sense of security for your family. Everyone benefits from building an open line of communication between your family and the professionals with direct knowledge of your situation. In a Family Meeting, we can work together to continue to educate your family, as well as develop a focus on being good stewards of business and personal wealth. Bottom line, YOU choose what YOU want to accomplish in your Family Meeting and we will help you make it happen.
If you would like to discuss any of these checklist items to help you accomplish an end of year goal, please contact one of our attorneys.
About the Author
L. Mackenzie Reid
Legal Project Manager
Senior Paralegal