Mistakes made during the estate planning process can prove to be costly. Even when individuals have consulted with an attorney in the drafting of a trust or will, they may want to give these documents another look when they are moving to another state. There may be additional state laws in the new location that will need to be met for the document to still serve its intended purpose.
For example, there are nine states in the country that are labeled community property states. In a community property state most anything one acquires during the marriage will become what is called community property where each spouse is a one-half owner. This may include an IRA, salary or a house. However, most states including Minnesota are not community property states and have a different set of rules.
A huge concern when speaking about estate planning concerns estate taxes and asset protection. We all wish to set aside money in some manner that provides for one’s heirs in the way we have intended. If no action is taken, certain assets when passed on may be subject to taxation. However, the assets can sometimes be protected through the creation of family limited partnerships and trusts.
The use of various tools like trusts can sometimes prevent certain assets from going into probate. There are a number of trusts that can be drafted to minimize estate taxation and provide for greater asset protection. However, we do need to make certain the trusts are properly administered. Estate planning attorneys can make certain that the duties of the fiduciary are administered in accordance with state law and the terms of the trust and that each beneficiary correctly receives what was promised to them.
Source: Forbes, “Moving To A New State: How To Put Down Financial Roots,” Deborah L. Jacobs, March 19, 2014
