Estate planning....I finally did it

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
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fittan
Posts: 214
Joined: Wed Mar 30, 2016 1:58 pm

Estate planning....I finally did it

Post by fittan » Fri Mar 22, 2019 9:35 am

I started off knowing that I need a will ASAP (I have 2 young kids). Then I read about the benefits of revocable trust. Then I found out about AB trust (i.e. 2 trust) because I live in MA which has a very low ($1 million) estate tax. I have educated myself along the way using google search, youtube, podcast and this forum.

Initially I wanted to go cheap and use Willmaker or legalzoom. But yesterday I finally engage an attorney who specializes in Estate planning. Met up with attorney for an hour together with wife. It is not cheap....total cost is $3200 but wife and I felt that it is money well spent. Not only do I learned about EP, my wife also have a good general idea of what to do in case I pass. We even started to discuss with our kids (regarding guardian). All in all a good experience. I just wanted to share this for those who are still on fence or procrastinating about EP. Just do it!

zz4
Posts: 84
Joined: Wed Dec 06, 2017 11:29 am

Re: Estate planning....I finally did it

Post by zz4 » Fri Mar 22, 2019 11:21 am

Thanks, been meaning to do it myself.

bsteiner
Posts: 4340
Joined: Sat Oct 20, 2012 9:39 pm
Location: NYC/NJ/FL

Re: Estate planning....I finally did it

Post by bsteiner » Fri Mar 22, 2019 11:38 am

fittan wrote:
Fri Mar 22, 2019 9:35 am
I started off knowing that I need a will ASAP (I have 2 young kids). Then I read about the benefits of revocable trust. Then I found out about AB trust (i.e. 2 trust) because I live in MA which has a very low ($1 million) estate tax. I have educated myself along the way using google search, youtube, podcast and this forum. ...
Revocable trusts made more sense in Massachusetts before Massachusetts adopted the Uniform Probate Code (which simplified the procedures) and the Uniform Trust Code (which eliminated the requirement that trusts under a Will file periodic accountings with the court) in 2012.

A and B are archaic terms for the marital and credit shelter (bypass) trust. They were more common before the 1981 Act which introduced the concept now known as the credit shelter (bypass) trust. Some people used to call the marital trust Trust A and the nonmarital trust Trust B.

Many people in Massachusetts limit the credit shelter trust to the $1 million Massachusetts exempt amount and elect portability.

arsenalfan
Posts: 750
Joined: Mon Dec 09, 2013 12:26 am

Re: Estate planning....I finally did it

Post by arsenalfan » Wed Oct 09, 2019 3:44 pm

Reawakening this thread, as I have a Mass Estate Trusts question.

I'm executor of a Massachusetts Estate, which has 3 properties worth ~$800k each, and $2.3 MM in IRA funds. It will be divided 50/50 to 2 beneficiaries.

The Estate created 3 separate trusts, one for each property.

Can anyone tell me how will this be taxed?

1. I presume no federal tax as under the exemption.
2. Any Mass estate tax? I presume the idea behind creating 3 separate property trusts was so each was valued < $1MM.
3. Will the IRAs be taxed?

Thanks in advance

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