Time to Update Your Will or Trust? Use This Checklist to Find Out

There’s no better way to serve your legacy than making sure your documents are in order.

Officially, it’s the start of autumn in Florida, but checking in on your will or trust is an evergreen concern. If it’s been a while, you should know that we’ve seen some substantial tax law changes over the past few years, including to the estate tax exemption, which peaks at $12 million. Now is a great time to confirm whether your documents are up to date.

Estate planning is an ongoing process, and a crucial one; falling behind could mean your money and assets end up in the wrong hands. Here is just a partial list of occurrences that could cause your will or trust to become outdated:

• A change in your or your heirs’ marital status
• Relocation to another state
• Having or adopting children
• Children aging out of minority status
• A significant change in asset value, whether through sales or appreciation
• A change in your health status, designated heirs or personal representative

We spoke with Rusty Spoor of Spoor Law, a firm affiliated with Spoor Bunch Franz, about what you should know before updating your estate planning documentation.

How often should you revisit your will or trust?

I would recommend your estate planning documents be reviewed or revisited if either of these two circumstances have occurred:
• There is a change in the law since your last set of documents was completed.
• There is a change in your life which would affect anyone you may have named in your documents or would affect provisions you would have put in your documents.
• If neither of these changes have occurred, it’s generally a good idea to review the documents every five years to make sure they still work as you intended.

What are the risks of letting that paperwork lapse?

If you don’t keep your documents up to date, there is a possibility that they won’t match what you originally intended. This could be the result of changes to the law that affect provisions you previously put in or changes in the relationships with individuals you named that would require a revision.

All too often, I work with people who had forgotten they named a certain person to a certain role, and due to changes in circumstances, that person would no longer be their choice for such a role. Also, some changes in law could have significant impacts on certain provisions, particularly on formulas used for funding bequests or the resulting trusts.

What are some good questions to ask your preparer?

Generally, it is best to tell your preparer what you want to have happen with your estate and/or assets, and your preparer can review the documents to determine if they are still sufficient to provide the results you intended. Circumstances change over time as children grow older or relationships with family and friends change, and the financial condition of a client almost always changes.

It is a good idea to lay out presently what you want and then check to see if the documents still work for your goals or if they need to be revised.

How much lead time do you need with planned changes? Is there a penalty for waiting too long for changes?

It’s important to make any changes to your estate planning documents either:
• Before or after the effective date of any change in the law (depending on whether or not you want to take advantage of the prior law or need to adhere to the new law), and
• Before your death or incapacitation.
There may also be tax implications as to timing of execution of documents. But generally speaking, the lead time on getting any changes done would depend on the availability of the preparer and the timeliness of answers or information provided by the client.

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