As a busy adult, you probably don't relish the thought of adding anything else to your schedule. There is one thing that you need to think about adding to it today: estate planning. It might seem as though you have plenty of time to get this done; however, you just never know when something will happen that will require parts of it to be put into effect.
One factor that people who own a business have to consider is the value of their estate when they pass away. Estate taxes can wipe out a good portion of what the heirs are supposed to get. There are options that you can use to reduce the possible estate taxes that are going to come. Here are some points to consider:
You probably don't want to think of the end of your life; however, this is something that you must consider if you have a business. When your business supports your family members, they need to know that they will still be taken care of when you pass away. This means you must ensure that you have a plan in place to meet their short-term needs, as well as one that helps keep the business afloat, so they can continue to receive that support.
Running a business is hard work. In many cases, the business owner will work tirelessly to try to grow the company. This doesn't leave much time for other things, but all owners should make time to ensure they have an estate plan established.
Business owners often plan for a lot of different situations that might come up. There is one very important plan that they might not ever think about putting into place until it is too late -- a succession plan, which can be part of an estate plan. Anyone who owns a business needs to get this done as soon as possible or else there is a chance that the company and employees will suffer if something happens to the owner.
When people count on you, making sure that you have your affairs in order is imperative. One way that you can do this is to set up your estate plan. You have to think carefully about what you are going to want everyone to get. Once you have that plan, you will be able to determine how to make your wishes happen.
Whether you have a massive estate, including a house, investment accounts and other valuable possessions or you only have the equity in your home to your name, you should take the time to create a last will. Doing so provides you with control over how your assets get allocated when you die. It also provides peace of mind, because you know the people you care for the most will receive your assets.
In our recent blog post, we discussed how some individuals use gifts to pay down an estate's value so that their loved ones aren't burdened with tax debt after you pass away. This is only one factor that matters when you are creating an estate plan. We know that you have a lot on your plate already since you are trying to run a business. We can't take all the work off your shoulders but we can do our part to try to make your estate planning process a little easier.
If your estate is going to be a considerable size when you pass away, you might want to take steps now to reduce the size of it so that your loved ones won't have to pay estate taxes. While there isn't an estate or inheritance tax in Arizona, there is an estate tax imposed by the federal government. This tax only applies to estates that are valued at $5.49 million or more.
Confronting the end of your life isn't easy. Most people don't like to think about that, but if you are willing to do this now and get your estate plan together, you can help your family members to work through your death without the undue stress that comes with dying intestate. Remembering this might be the fuel that you need to keep moving forward despite the difficulty of thinking about these matters.