Two weeks ago, I litigated a seven-figure contested estate. Thankfully I won the trial, largely because the decedent had executed estate planning documents with an experienced estate planning attorney. Still, the decedent could have taken a few more steps to ensure his wishes were carried out. While he probably could not have prevented a contest, he may have been able to prevent a trial, which put the entire estate at risk.
The Tax Cuts and Jobs Act, which passed in December 2017, is yet another reminder of the importance of keeping your estate plan up-to-date. While there was a lot of media attention on the personal and business income tax changes, there has not been much public focus on the implications of the Act for estate planning.
The Act increased the estate and gift tax exemption and the generation-skipping transfer tax exemption from $5,490,000 to $11,180,000 per person and $23,360,000 for a married couple. For obvious reasons, many people have taken this increase as a license to avoid seeking the advice of an estate planning attorney. However, the increase is scheduled to expire in less than eight (8) years. Additionally, our benevolent American government, Congress and President have the ability to reverse the exemptions at any time. Ms. Megan Jerabek, Esq., provides two timely considerations: 1) Estate plans that are more than three (3) years old are in the greatest need for review; and 2) Having a flexible estate plan that may be easily adjusted as the tax law changes is the best way to ensure that your objectives can be accomplished efficiently.
See Megan L.W. Jerabek, Not So Simple Estate Planning Considerations After 2017 Tax “Simplifications,” National Tax Review, May 17, 2018.