Figuring out how transferring assets via gift or inheritance will trigger capital gains taxes is an important step in a comprehensive estate plan. Factoring in tax impact is an important part of your investing strategy as well as your estate planning strategy. While estate planning attorneys focus on estate and gift taxes primarily, it is also important to weigh out capital gains scenarios and implement strategies to minimize those taxes as well.
There are several types of taxes. The government wants a cut of your income which translates into income tax. When someone leaves an inheritance higher than the current exemption amount, an estate tax is assessed. When someone gives a gift higher than the current $15,000 annual allowance and over the current lifetime exemption amount, a gift tax must be paid. And finally, when someone sells an asset and realizes a gain, the capital gains tax comes into play. A capital gain occurs when you sell an asset for more than you (or the person who gave it to you) paid for it.
Short-term capital gains rates are higher than long-term capital gains rates. An investment must be held for a full year before selling to qualify for the long-term capital gains rate. Capital gains are applied to capital assets such as stocks, bonds, jewelry, real estate, vehicles and art/collectibles. Take note that a primary residence falls under a special exclusion. The first $250,000 of the seller’s gains is excluded ($500,000 for couples filing jointly) as long as it was owned and lived in for more than 2 years.
The current (2021) tax rates for capital gains are 0%, 15% and 20% depending on your taxable income level. These rates may increase under new legislation proposed. To minimize capital gains taxes invest for the long term, use tax-deferred retirement plans as investment vehicles and employ strategy to offset losses with gains when possible. You can also move assets into living trusts for the benefit of your heirs and allow your cost basis in the asset to transfer to the beneficiary.
As you can see, estate planning requires the careful consideration of numerous factors including all types of tax implications. For assistance in creating a comprehensive estate plan, contact the experienced and knowledgeable attorneys at Stouffer Legal in the Greater Baltimore area. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufflerlegal.com
What happens to your farm, if the children have no interest in that lifestyle?
Some farmers are caught between wanting to see their farm operation continue after they are gone and the fact that their children have no interest in working a farm, according to the Iowa Farmer Today in "Good fences make good neighbors."
We all know that farming is a hard life with stiff competition, long hours and the constant threat of bad weather. It is also a different lifestyle than most Americans live and sometimes the children of farmers do not want to go into the industry.
Farmers need to decide how they should leave an inheritance for their non-farming children. It is a difficult decision whether to leave children the land and equipment or to sell everything off and leave the children the proceeds.
The key to making the decision might be asking the children what they prefer.
Of course, if everyone is uncertain, the children can always sell things off after they inherit, if that is what they want to do.
An estate planning attorney can guide you in creating an estate plan that meets your unique situation. Call (443) 470-3599 today and schedule a consultation with Maryland Attorney Britt L. Stouffer to learn more about Estate or Elder Law and how she can help you.
As we age, the risk of dementia exponentially increases. Dementia encompasses a wide variety of diseases related to cognitive decline. It typically presents with symptoms of forgetfulness, irritability, and confusion. There are 3 main ways to stave off dementia – staying physically active, maintaining a nutritious diet and exercising your mind.
Staying Physically Active
Regular physical activity is one of the best ways to reduce your risk of dementia. Incorporating both aerobic activities and resistance training into your routine will also help circulation, weight and mental health beyond dementia. At least 20 minutes per day is recommended by most health professionals. Some suggested activities include walking, chair yoga, tai chi or pedaling on a stationary bike.
Maintaining a Nutritious Diet
Eating well not only reduces the risk of dementia, but also other conditions like cancer, diabetes and heart disease. Eat a protein-rich diet including fish, eggs and beans rounded out by fresh fruit and vegetables. Limit your sugar intake and processed carbohydrates. Stay hydrated by drinking 6-8 glasses of water each day.
Exercising Your Mind
Challenging your mind with puzzles, crosswords, sudoku or card games helps keep the mind active which reduces the risk of dementia. Reading, both fiction and non-fiction, is also helpful. Being social and communicating daily with others also stimulates the mind. Make an effort to seek out others for enjoyable conversations each day.
A few other healthy tips for reducing the risk of dementia include not smoking, cutting back or out alcoholic beverages and ensuring you get enough sleep and rest. At Stouffer Legal we care about our seniors and encourage them to seek ways to stay healthy and alert. For more information on senior caregiving, long-term care planning, Medicaid planning or estate planning please contact our office in the Greater Baltimore area. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufflerlegal.com
LIVE Webinar – Click Here to Register for April 13th at 10am
How to Protect your "Stuff" in 3 Easy Steps (Estate Planning Workshop)
This webinar covers frequently asked questions and common misconceptions regarding: Wills & Trust, Asset Protection, Nursing Home Issues, Medicaid Qualification, and Estate Taxes.
Please click to register for our webinar:
LIVE Webinar – Click Here to Register for April 13th at 10am
Our webinars are designed to be educational, interactive, informative and generate relevant discussion for attendees. Modern Estate Planning is more than just preparing a will and putting it in a safe. Find out how a comprehensive Estate Plan will protect your assets and your family. Our experienced attorney, Wilson McManus, will be sharing stories on how Estate Planning is beneficial and sometimes crucial. In an Estate Plan, you need to know the Rules: Who's "Rule-book" controls your Estate Plan? Yours? The Governments? Someone else? You need to know your Predators: Who's a Threat to Your Stuff? The Government? Long-term Care Costs? Your Family? You need to know your Options: What Plans are out there? Does a Will work? What about a Trust? Which kind of Trust?
Please click to register for our webinar:
LIVE Webinar – Click Here to Register for April 13th at 10am
Our workshops fill up fast, so please call (443) 470-3599 today to RSVP.
We can't wait to see you!
Today is the right day to take your first step. Click below to register for our next free workshop and learn what everyone is talking about. Attending our next free Workshops is the best way to Get Started on your New Estate Plan!
Many entrepreneurs have complicated financial situations and may need both a CPA and an experienced estate planning attorney involved in the process of creating an estate plan. The main reason for including the CPA is that many entrepreneurs have business interests spread out over several different entities. The CPA will be familiar with the whole financial picture and can provide a better context to dive into discussing how those assets will be distributed upon death, how to plan better for incapacity and provide information to plan for retirement via business succession planning.
Once the team of advisors have a clear understanding of the financial picture, the entrepreneur needs to provide insights into his or her legacy goals. Leaving behind a legacy may have to do with more than assets and wealth for entrepreneurs. Some have goals related to the continuation of the busines and maintaining its reputation. Others have charitable and philanthropic goals in mind.
Most entrepreneurs tend to leave their legacy to some combination of the future of the business, family, long-term business partners and charitable interests. Getting absolutely clear about who and what will benefit steers the rest of the discussion around how to implement a plan that will achieve the goals. There are so many tools and strategies that can be used such as living trusts, charitable remainder trusts, spousal lifetime access trusts and charitable lead annuity trusts. Each type of trust has a specific strategy behind it.
Entrepreneurs need a myriad of tools including emergency business plans, business succession plans and personal estate planning that need to harmoniously blend to accomplish all legacy goals. Start building your team of trusted advisors today. At a minimum you should have your CPA collaborating with your estate planning attorney. If you have a large investment portfolio, you may also want a financial advisor to participate in the process. You may also need a real estate advisor, insurance specialist and philanthropic advisor. Start by contacting the experienced estate planning attorneys at Stouffer Legal in the Greater Baltimore area. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufflerlegal.com
Click Here to Register for Saturday, April 10th at 10am
How to Protect your "Stuff" in 3 Easy Steps (Estate Planning Workshop)
This webinar covers frequently asked questions and common misconceptions regarding: Wills & Trust, Asset Protection, Nursing Home Issues, Medicaid Qualification, and Estate Taxes.
Please click to register for our webinar:
Click Here to Register for Saturday, April 10th at 10am
Our webinars are designed to be educational, interactive, informative and generate relevant discussion for attendees. Modern Estate Planning is more than just preparing a will and putting it in a safe. Find out how a comprehensive Estate Plan will protect your assets and your family. Our experienced attorney, Wilson McManus, will be sharing stories on how Estate Planning is beneficial and sometimes crucial. In an Estate Plan, you need to know the Rules: Who's "Rule-book" controls your Estate Plan? Yours? The Governments? Someone else? You need to know your Predators: Who's a Threat to Your Stuff? The Government? Long-term Care Costs? Your Family? You need to know your Options: What Plans are out there? Does a Will work? What about a Trust? Which kind of Trust?
Please click to register for our webinar:
Click Here to Register for Saturday, April 10th at 10am
Our workshops fill up fast, so please call (443) 470-3599 today to RSVP.
We can't wait to see you!
Today is the right day to take your first step. Click below to register for our next free workshop and learn what everyone is talking about. Attending our next free Workshops is the best way to Get Started on your New Estate Plan!
Asset protection planning involves strategies that protect certain types of assets from being exposed to future risks. Examples of those risks may involve divorce, creditors or lawsuits. Some basic rules of asset protection planning include:
Rule #1:Keep ethics in mind with every step you take. Know that while the strategies employed by knowledgeable estate planning attorneys do help protect assets, you cannot “hide” assets. During a divorce, you will be forced to provide a full financial disclosure. Same goes if you later file bankruptcy. And it goes without saying, that full disclosure is required for all tax filings. Let this #1 rule be the underlying basis for all of your asset protection planning.
Rule #2:Start planning before the problems arise. Once you are aware of a lawsuit, creditor situation or legal separation heading towards divorce, it is likely too late to utilize asset protection strategies. It can even be more damaging if viewed as fraudulent leading to additional penalties or even criminal charges.
Rule #3:Most strategies involve creating trusts and/or business entities to protect these assets. To keep in line with Rule #1 it is best practice to place personal assets into trusts and business assets into business entities. Placing personal assets into a business entity may backfire and creditors may be allowed to “pierce the corporate veil”. Piercing the corporate veil is legal terminology for coming after those assets even though they are owned by a business. Trusts, when drafted correctly, are a much safer vehicle to protect personal assets.
Rule #4:Find the balance regarding the control of the assets. Estate planning attorneys can draft the language so that the owner of the asset still retains some control while separating the asset from the owner just enough that creditors and the like cannot argue no separation exists between the asset and the owner.
Rule #5:Finally, keep in mind that asset protection planning is a subset of the overall comprehensive estate plan. There may be situations where some popular asset protection strategies do not align with your overall objectives. Define your overall goals before diving into particular asset protection strategies.
Start asset protection planning now before you find yourself exposed to risks. Schedule a consultation with the experienced asset protection planning attorneys at Stouffer Legal in the Greater Baltimore area. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufflerlegal.com
Wills are often dry, technical documents. However, they can be beautiful things.
Wills can be beautiful, if done correctly and for the best intentions, according to Nasdaq in "A Will Can Be a Beautiful Thing."
The potential beauty of a will is not in the actual words themselves.
That much should be obvious, because most wills are, in fact dry, technical and boring legal documents to read. They often contain formal required language that does not change very much from will to will.
The true beauty of a will is in what lies behind the words.
A will, at its best, tells how a person wants his or her loved ones to be taken care after the person passes away.
It is an expression of caring and love.
A will shows that we have carefully thought about what will happen to the people we love, after we pass away.
That can be a beautiful thing, even if the language itself is dry and boring.
An estate planning attorney can guide you in creating an estate plan that may be dry and technical, but takes care of your loved ones. Call (443) 470-3599 today and schedule a consultation with Maryland Attorney Britt L. Stouffer to learn more about Estate or Elder Law and how she can help you.
It may be surprising that comprehensive estate planning also takes into consideration issues related to funeral and burial instructions. With the shocking costs of traditional burial arrangements, the option for cremation is thoughtfully considered during the estate planning process. While saving money is the driving force for many who choose cremation, environmental concerns also tend to be a factor. The space taken up by burials, the chemicals used for embalming and the products used for caskets all have detrimental impacts on the earth. Many environmentalists are studying these impacts and looking for alternative ways to respectfully, but naturally, bury the dead. While cremation is still not the most environmentally friendly, it is preferable to traditional burials from an environmentally-conscious point of view.
Cremation services can be customized to fit your budget and preferences. The cost of cremation is determined more by the preferences for services to honor the deceased and placement of the ashes than by the cremation process itself.
Some prefer to have the body embalmed and available for viewing in a casket while others simply wait the 12 hours required by Maryland state law and then have the body cremated. The services, if any, are then conducted without a body present.
Choosing the final resting place also impacts the costs (and the environment). Urns range in price based on the complexity and type of materials used. The urns containing the cremated ashes may be kept in a private residence, buried in a smaller plot in a traditional cemetery, interred in a mausoleum or incorporated into a private garden. The costs will also increase based on the types of headstone or markers used to designate the final resting place. It also popular (and inexpensive) to simply spread the ashes in an area sentimental to the deceased or his or her loved ones. Environmentalists also caution those spreading ashes about where they choose to do so. The Environmental Protection Agency (EPA) has published guidelines about spreading ashes.
To discuss the pros and cons of traditional burial arrangements versus cremation or other eco-friendly modern alternatives as part of your comprehensive estate planning, contact the experienced attorneys at Stouffer Legal in the Greater Baltimore area for more information. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufflerlegal.com.
LIVE Webinar – Click Here to Register for April 6th at 10am
How to Protect your "Stuff" in 3 Easy Steps (Estate Planning Workshop)
This webinar covers frequently asked questions and common misconceptions regarding: Wills & Trust, Asset Protection, Nursing Home Issues, Medicaid Qualification, and Estate Taxes.
Please click to register for our webinar:
LIVE Webinar – Click Here to Register for April 6th at 10am
Our webinars are designed to be educational, interactive, informative and generate relevant discussion for attendees. Modern Estate Planning is more than just preparing a will and putting it in a safe. Find out how a comprehensive Estate Plan will protect your assets and your family. Our experienced attorney, Wilson McManus, will be sharing stories on how Estate Planning is beneficial and sometimes crucial. In an Estate Plan, you need to know the Rules: Who's "Rule-book" controls your Estate Plan? Yours? The Governments? Someone else? You need to know your Predators: Who's a Threat to Your Stuff? The Government? Long-term Care Costs? Your Family? You need to know your Options: What Plans are out there? Does a Will work? What about a Trust? Which kind of Trust?
Please click to register for our webinar:
LIVE Webinar – Click Here to Register for April 6th at 10am
Our workshops fill up fast, so please call (443) 470-3599 today to RSVP.
We can't wait to see you!
Today is the right day to take your first step. Click below to register for our next free workshop and learn what everyone is talking about. Attending our next free Workshops is the best way to Get Started on your New Estate Plan!
