Keeping a DC Estate Plan Updated
There are many reasons to periodically visit an attorney and update an estate plan. Any time that clients move in or out of DC, it may be helpful to have a document reviewed by someone in the new state of residency. In the DMV area, Maryland, DC and Virginia, inheritance and estate tax laws differ greatly in each jurisdiction. The type of planning that may be complete in the District of Columbia may need to be revised or tweaked in Virginia and vice versa. It can be helpful to have an estate planning attorney who is knowledgeable about the laws of the state where the client now resides review those documents to see if they need to be changed to comply with the laws of the state.
If documents were created for a different jurisdiction and a client recently moved into the District of Columbia, it may be necessary to update those documents according to DC law. Every state has specific signing requirements. It may be prudent to speak with an estate planning attorney in DC to review the documents and determine if those signing requirement have been met, or to see if there is anything that is required to update the document pursuant to DC law.
One of the unique aspects about planning in DC is that DC has its own estate tax, and a much lower exemption than the federal estate tax. Some states have done away with their estate tax while others, such as Maryland, plan to increase their estate tax filing exemptions so that they are aligned with the federal exemption. DC currently only protects estates that are $2 million or less, which is significantly less than the current federal estate tax exemption of $5,450,000.
Consult an Attorney
After moving into DC, an attorney can assist with reviewing documents to see if they comply with DC law. It may also be a good time to review an estate plan to see if any other changes have occurred, such as a birth in the family, a death in the family, a divorce in the family, or a significant reduction or increase in wealth. It is a good time to review all of the estate plan to see if the plan that is in place is still the best plan or if there are modifications that can be made to update the plan so that it is compliant with DC law and the most up-to-date plan for the family.
A DC attorney can be valuable in evaluating an estate plan. Our firm handles estate planning for Maryland, DC, and Virginia, so as clients move throughout the area, we can review documents to see if they need to be updated or tweaked for any new jurisdictions. Our firm can also assist with estate tax planning, which streamlines the process of determining what kind of estate plan may be most favorable to a person.
Important Aspects of Estate Planning
Estate planning is a welcome gift to leave for your loved ones. A comprehensive estate plan that has been updated frequently can often minimize administrative costs, reduce the opportunity for family disputes, and aid in passing on assets after death. In addition to providing for loved ones, planning for your own incapacity is often a forgotten aspect of estate planning. Planning for incapacity during your lifetime while you still have the required testamentary capacity can often prevent the necessity of having a guardianship proceeding or guardian appointed on your behalf. Guardianship, in any jurisdiction, can be costly, time-consuming, and requires continued court supervision.
Although last wills and testaments and trusts are more commonly thought of during estate planning, sometimes, planning for incapacity can be one of the more important elements of a plan because those documents affect you while you are alive. While thinking about a catastrophic event, emergency, or your own demise is never a pleasant experience, going through the process and completing a plan can be one of the best ways to ensure that your loved ones are cared for.