The purpose of forming an estate plan is to ensure that the proper people collect designated property at the right time. These recipients are known as beneficiaries and may receive property through a trust, a will, or a collection of other estate planning documents.
Choosing the correct beneficiaries has a profound impact on not only those people receiving the property but also those transferring it to others. This choice can have tax implications as well as determine the future of others for years to come. An experienced attorney could help you make proper beneficiary designations in Manhattan estate planning. Call today to get started.
Potential Taxation Issues and Beneficiary Designations
In Manhattan, there is no estate or inheritance tax. However, this does not mean that these taxes may not still impact one’s beneficiaries. If beneficiaries live in a state that still imposes an inheritance tax, they will need to pay those taxes upon taking possession of the property that they inherit.
To avoid these complications, it may be best to limit the tax liability of an estate by lowering its value through creative estate planning. One popular way to accomplish this is to place property into a trust that distributes assets upon a person’s death. Property that moves in this way is not part of an estate and therefore is immune from inheritance taxation. A seasoned Manhattan attorney could help an individual craft their estate plans in ways that limit the overall taxation through proper beneficiary designations.
Naming Beneficiaries in a Will
Not every person is eligible to be a beneficiary in a will. One common exception involves children. Children cannot directly inherit property unless they are 18 years of age or older. If these people are named beneficiaries in a will, the property will go to a guardian or a trust until that person comes of age.
It is also vital to be sure to accurately name each beneficiary in a will. For instance, avoid using general terms like “My children.” Instead, name those children with as much specificity as possible. Failure to be specific may lead people to challenge the authenticity or efficacy of a will. This could result in a probate court invalidating a will and distributing assets according to the intestacy rules present in Kansas Statute § 29-501 et seq. Taking steps to ensure accurate beneficiary designations in Manhattan could help an individual to avoid this outcome.
Effective Beneficiary Designations in Manhattan Estate Planning Helps to Streamline the Probate Process
Choosing the proper people to inherit your property in the future ensures the most effective possible estate plan. With this in mind, helping your estate to retain its maximum value may require a careful choosing of individuals and charities to inherit assets. While people are free to choose almost any party to take control of assets, these assets may be subject to taxation or temporary holding depending upon the age of an heir or where they live.
A knowledgeable attorney could help you to make more effective beneficiary designations in Manhattan estate planning. Call our office to learn more about how our skilled legal team could assist you.