As the year draws to a close, it’s the perfect time to review your estate plan and ensure it’s aligned with your goals and the latest tax laws. Proactive steps now can help minimize tax liabilities, maximize gifting opportunities, and set the stage for a smooth transition of your assets. At Duncan Legal, PC, we’re here to guide you through these essential end-of-year tasks.
1. Review Your Estate Plan
Life changes quickly, and your estate plan should keep pace. Take time to review your will, trusts, and other documents to ensure they reflect your current wishes and family circumstances. This is especially important if you’ve experienced major changes this year, such as:
- The birth of a child or grandchild
- A marriage or divorce
- The passing of a loved one
Additionally, confirm that your named executors, trustees, and agents under powers of attorney are still appropriate for their roles and able to fulfill their responsibilities.
2. Optimize IRA Distributions
If you’re required to take minimum distributions (RMDs) from a retirement account like an IRA, be sure to do so before the end of the year to avoid penalties.
Even if you’re not required, consider whether making strategic withdrawals now could lower your taxable income in future years. If you’re feeling charitable, a Qualified Charitable Distribution (QCD) from an IRA can satisfy RMD requirements while benefiting a cause close to your heart. Work with your estate planning attorney to ensure these actions are completed correctly and within the proper timeframe.
3. Take Advantage of Year-End Gifting
The annual gift tax exclusion allows you to gift up to $18,000 per recipient in 2024 without impacting your lifetime estate tax exemption. Making gifts before December 31st can help reduce the size of your taxable estate while also sharing your wealth with loved ones or supporting your favorite charities.
However, gifting may impact benefits eligibility for you or your beneficiaries, such as Medicaid. Consult with our experienced attorneys to navigate these complexities and ensure your gifting strategy aligns with your overall estate plan.
4. Update Beneficiary Information
Beneficiary designations on retirement accounts, life insurance policies, and other financial instruments often take precedence over what’s written in your will or trust. Review these designations to ensure they reflect your current intentions.
Additionally, verify that all contact information—addresses, phone numbers, and emails—for heirs and key advisors is accurate. Keeping these details up to date avoids administrative headaches and ensures a smoother process for your loved ones.
Estate planning is not a set it and forget it process. Regular updates—especially at critical moments like year-end—ensure your plan is optimized to protect your legacy and minimize tax exposure. By taking these steps now, you can move into the new year with confidence, knowing your estate plan is working as hard as you do.
For personalized assistance with your estate plan, contact Duncan Legal, PC at (303) 394-2358 or visit www.duncanlegal.com. Let us help you secure your legacy and start the new year on the right track.
