Some estate planning steps may be possible just before death

If an individual or a loved one is entering into an end-of-days hospice-type situation, there are actually some actions to take that can help economically and increase everyone’s peace of mind. These late estate planning moves are fairly universal and will generally apply in Minnesota as well as elsewhere. First, it is important to make sure that the patient’s durable power of attorney has been executed and is operational.

The POA allows a trusted friend or loved one to handle all necessary signatures and paper work. This can be a great help in reducing stress and bureaucratic delays in processing necessary paper work. It is necessary to check all beneficiary designations to make sure that they have been correctly finished and submitted. This applies to life insurance, retirement accounts with death benefits, investment accounts and anything with a specific option for a beneficiary transfer.

A hang-up with a beneficiary validation could knock significant proceeds into probate, which, in general, is to be avoided in borderline situations. A swap of assets between the benefactor and beneficiaries or estate heirs can realize significant tax benefits. However, all transfers done for tax savings should be reviewed and approved by a tax specialist or by one’s estate planning attorney.

For those Minnesota residents who desire to make charitable contributions during life, this should also be discussed with the tax specialist, investment advisor and/or the attorney. There are also several other focused estate planning moves that can economically benefit the estate or the beneficiaries. One of the special concerns may be to avoid income payable to the decedent on account of death. Thus, accelerated distributions from IRAs may be beneficial if timed correctly. Other income coming to a dying loved one may be diverted to avoid higher taxes, but again, these complex moves must be done only with the input and approval of an experienced advisor.

Source: nasdaq.com, “6 Estate Planning Tips for Those Approaching Death”, John M. Goralka, July 26, 2016

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