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  • Matthew D. Massar

PLANNING FOR THE UNEXPECTED



Helping our clients plan for life’s unexpected events—whether it’s welcoming a new family member, coming into an inheritance, or dealing with an illness—is at the heart of what we do. As we are (hopefully) approaching the end of the COVID-19 era, it’s a great opportunity to remind ourselves how we can continue to help our clients plan for the curve balls that life throws us.

When most estate planning attorneys discuss contingency plans with their clients, they often default to relying solely on wills and powers of attorneys to help clients plan for the inevitable—death and/or incapacity. However, besides health issues, there are a host of other unexpected events that clients need help anticipating and planning for. Below are just a few examples.

Tax law changes. We’ve been told that there are two certainties in life—death and taxes. While it’s certain that they will happen, no one can anticipate the “when” and “how”. This is especially true for tax laws, which can change significantly as seen by the recent passage of the Tax Cuts and Jobs Act in 2018. While it’s imperative to periodically update our clients’ estate planning documents, there are also opportunities in the drafting process to design these documents to be adaptable to these changes. You can do so by including features like trust protectors, decanting powers, and discretionary distribution powers, which can help to maximize current tax opportunities while minimizing the risks of the unexpected changes in tax laws.

Birth of a child/grandchild. A new addition to the family is often an unexpected and happy surprise. But, improper planning may unintentionally disinherit or otherwise inadequately plan for the new child/grandchild. Help your clients avoid these scenarios by being aware of the issues and risks related to joint tenancy and beneficiary designations. Additionally, unfunded trusts can be a huge risk factor. Since a trust only controls the assets it owns or receives, any asset not allocated into the trust may be subject to probate and may be divided between the spouses in the event of divorce proceedings.

Change in marital status. While getting married is typically a thoroughly planned out affair, divorce, on the other hand, is often unexpected. Despite a happy couple’s hesitation to talk about this topic, it’s prudent to include asset protection in their estate plans, both for themselves and their beneficiaries. To help clients preserve assets for divorcing beneficiaries, consider using beneficiary controlled trusts and discretionary distribution features. For clients looking to protect their own assets from divorce, Domestic Asset Protection Trusts can be a preferable alternative to prenuptial agreements.

If you've recently had unexpected events affect the plan you had in mind for your estate, call us today to discuss strategies to deal with them currently and plan for the next round of unexpected events in the future.

ABOUT THE AUTHOR


Matthew D. Massar is an experienced estate planning attorney, founder of the Streamlined Estate Planning Process, and Managing Director at the Massar Law Firm PLLC, a law firm with offices in Austin, Houston, and San Antonio. He crafts estate plans for his clients the streamlined way - with flat-fee pricing, understandable and efficient processes, and a turnaround time of 2 weeks or less. Click here to book a no-cost consultation call with Mr. Massar today.


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