Estate planning has become one of the more complex financial processes for some people. Traditionally, estate planning mostly consisted of getting your financial affairs ready to take care of your family after your death. However, now it has expanded to serve other purposes as well, such as leaving behind a legacy and making a difference in the world. Exemptions and federal tax rates have made the process of estate planning more difficult than it used to be, though. Therefore, it would benefit you to begin planning as soon as possible.
New Jersey residents might benefit from understanding probate procedures before spending money in an attempt to avoid it. The probate process in New Jersey is simpler than it is in other states, and it usually requires filing an easy application in order to designate an executor with the surrogate of the county where the person who died resided. The procedure is neither as expensive nor time-consuming as it is in some other states.
According to an expert from New Jersey Today, naming an executor for one's estate is one of the most important decisions that a person can make. After all, someone must remain behind when they die in order to settle their affairs. Many people consider being the executor an honor; some people deem it a chore. In either case, there is a ton of work involved.
New Jersey residents who are unhappy with their children may end up leaving them out of their will. This can cause a rift to form in families and lead to lawsuits, dragging out the probate process. While it is up to an individual to determine who gets what once they pass on, it may be a good idea for people to really think about the impact disinheriting a family member will have.
Since the estate tax does not affect an inheritance until it gets to $5.25 million, most people are not concerned with that when it comes to the liquid assets in their estate. Only millionaires and their heirs are affected by that particular issue.
New Jersey residents dying without an estate plan subject their families to court-related delays and allow the state to determine who gets their assets. Most Americans know that having an estate plan is important, but less than half have actually undertaken the process of creating one. Estate planning does not have to be a monumental task; a few simple steps can formulate the basis for a simple or complex estate plan.
Administering an estate in New Jersey begins with locating a will. The items that the will controls, or probate assets, and the person who will be in control of the distribution of these assets will be named in the will as the executor of the will. In some cases, the deceased party may leave behind a trust document. However, there are cases in which there is no will or trust document left. In these cases, an administrator will need to handle the estate administration based on the prior estate planning.
New Jersey residents who are married may wonder about the process of setting up an estate plan for a spouse. Some spouses simply hold assets jointly, titled so that a spouse automatically inherits them at the time of death, or they have a basic will that leaves everything to a spouse. However, a simple estate plan can ensure that all assets are accounted for and transferred according to the testator's wishes.
Many people may believe that estate planning only benefits the elderly or the very wealthy; however, estate planning is important for everyone, even those with limited assets. Estate planning includes wills, but it also includes living trusts.
Since 2001, there have been many changes to federal tax laws regarding estates. In the complicated world of estate planning, the focus has been on exemption amounts and the tax rate above it, even in New Jersey. From 2001 to 2010, the exemption rate continually rose while the tax rate declined until disappearing completely during most of 2010. The tax returned in 2011 and the exemption was set at $5 million with a 35 percent rate above that, and the American Taxpayer Relief Act made those 2011 changes to the exemption rate permanent.