Boston Estate Planning

How do you calculate the Massachusetts Estate Tax?

gabrielcheong — Thu, 15 Sep 2011 18:36:21 +0000

First, there’s a difference between the Federal Estate Tax and the Massachusetts Estate Tax. They’re related but very different.

The Federal Estate Tax for this year applies only to those individuals with assets worth over $5 Million and is taxed at a 35% rate. The Massachusetts Estate Tax applies to individuals with assets worth over $1 Million and the tax rate varies. If a person is subject to both the Federal and State tax, then their marginal estate tax rate could be 45% or more. However, for most individuals who have assets between $1M and $5M, then the tax rate hovers anywhere from 0% to 20%.

For a more comprehensive calculation, see the Department of Revenue site calculations.

Does marriage invalidate or revoke a will?

gabrielcheong — Mon, 22 Aug 2011 14:01:58 +0000

Here’s the situation: you drew up a will and then sometime later, you get married. Does the act of marriage, invalidate or revoke the will made previously?

In the past, the answer would be ‘yes’. Many articles and posts online will probably say so. However, in 2009, Massachusetts adopted the Uniform Probate Code which brought the state in line with other states who adopted the same set of laws. The 2009 adoption provided that starting in July 1, 2011, a marriage will no longer invalidate a previously made will. However, due to budgetary restrictions, the court and the legislature decided to postpone the implementation of the new law until January 2, 2012

So in short, starting January 2, 2012, a Will made will always be valid.

What is the difference between a Power of Attorney and Executor?

gabrielcheong — Fri, 29 Jul 2011 09:00:12 +0000

A Power of Attorney has the authority to handle your property and finances. They are also able to sign for you while you are still living. However, when you pass away, this power also ends.

On the other hand, an executor for your Will has the authority to handle your property and finances after you have passed away.

So basically, power of attorney has authority to act on your behalf while you are alive while an executor has the authority to act on your behalf once you have passed away.

What are some reasons why I should discuss my Will with my children?

gabrielcheong — Thu, 28 Jul 2011 09:00:52 +0000

One reason why one would want to discuss their estate planning with their children is if they are going to name one of them as their executor. A child should know of your plans to appoint them. You may also want to discuss executor plans if you are having a difficult time deciding who to choose as executor.

Also, you may want to discuss property that you are leaving to your children in order to prevent any arguments. Making sure everyone knows what is going on and what their responsibilities are will help everything run smoothly and without any problems. It also allows for everyone to voice their opinions and concerns.

Can I appoint a bank as an executor of my estate?

gabrielcheong — Thu, 02 Jun 2011 09:00:01 +0000

Sometimes you might not trust any family members or friends to be the executor of your estate. When this occurs, you have the option of appointing a bank as executor of the estate to make sure that your wishes are fulfilled. Banks are good executors because they are neutral to the will, they understand the law, and they have experience. Some banks have trust departments that can provide services that allow the bank to be appointed as executors or trustees. You will want to talk with your bank to see if they have a trust department. You will also want to discuss with them what they charge for this service.

What happens if I do not want to inherit something?

gabrielcheong — Wed, 01 Jun 2011 09:00:37 +0000

Although it may sound strange that someone would want to turn down an inheritance, there are situations where it may be wise to not accept the inheritance. It is possible to turn down an inheritance by filing a disclaimer. A disclaimer is the refusal to accept an inheritance. The disclaimer must be in writing and submitted to the court that is overseeing the disposition of the estate within nine months of the decedent’s death and before he or she has received the property. The decedents will shall determine to whom the property will pass but if there is no will, the intestate laws of the state will determine who will receive the property.

In some situations, if you turn down an inheritance, it might still be counted against you as a gift that you received and gave away again. For a more definite analysis of your specific situation, you should speak with an attorney.

What happens if divorced parents disagree on a guardian for their child?

gabrielcheong — Fri, 13 May 2011 09:00:43 +0000

Usually when the first parent passes away, that parent will not have a say in who will be in charge of raising the child. In most cases, the surviving parent will take custody. Exceptions to this would be if the parent has a history of abuse, if the parent doesn’t want custody of the child, or if the parent is in prison. Then, the parents will will say who will be the guardian of the child.

In the unlikely event that both parents passes away at the same time, it is preferable that the parents can agree on who will be guardian for their child. If this doesn’t happen, then there will probably be a contested court case if there are competing parties that want guardianship of the child.

Should I update my will if my spouse recently passed away?

gabrielcheong — Thu, 12 May 2011 09:00:05 +0000

Yes, it is important to update, or at least have your estate planning attorney review your will once a spouse passes away in order to make sure that your assets do not end up going to an unintended beneficiary.

Usually people leave the majority of their assets to their surviving spouse. Therefore, you will want to change this if your spouse has passed away and give it to your other loved ones. If you do not do this then your assets could end up in the hands of someone else. You could also leave something to charity if you do not have anyone you wish to leave something to. Other reasons you may want to update your will are if you have a new baby, a new home, or additional income.

How do I decide who will be the caregiver for my pet and how much money to leave for your pet?

gabrielcheong — Wed, 11 May 2011 09:00:25 +0000

When deciding who will be the caregiver for your pet, it is most important to think about the people who love your pet and would be willing to watch your pet permanently. You want someone who will be able to provide a home for your pet and take on the responsibilities associated with the pet. You should also think about who you would trust to watch your pet and who would take care of the pet according to your terms. Someone might want the pet but they may not treat the pet the way you want your pet to be treated.

When deciding how much money to leave to your pet, you will need to consider how old your pet is, any medical conditions the pet may have that will incur medical bills, the cost of feeding and grooming your pet, and how much you intend on compensating your pets caregiver. You will need to figure out how much it currently costs to do all of these things on an annual basis and multiple this by the remaining life expectancy of your pet.

Since Massachusetts now allows for Pet Trusts to be created, any planning for your pet should be done through a trust so that you can be certain that whoever you choose to look after your pet, they will be bound by law to do so.

How can a health care proxy be revoked?

gabrielcheong — Fri, 08 Apr 2011 15:43:35 +0000

There are a few ways that a health care proxy may be revoked. It can be revoked if one of the following events occur:

1. If you sign a different health care proxy at a later date,

2. If you divorce or legally separate your spouse who you had named in your health care proxy as your agent,

3. If you notify your agent, doctor, or any other health care provider, either orally or in writing, that you are revoking your health care proxy,

4. And finally, if you do anything that will show that you want to revoke your proxy, such as telling other people that you are revoking it, ripping the proxy, etc.