Let’s face it- thinking about being in a situation where we aren’t able to speak or act for ourselves is something we’d rather not dwell on. When it comes to a Health Care Directive, most of us have the attitude of “I’ll get to that someday…when I’m older” or “I’m in great health, I can worry about it later.” Unfortunately, life happens, accidents happen and it’s good to be prepared.
It’s important to let your wishes be known to the people who are significant in your life and to your health care providers. If you’ve been to a doctor’s office or have been admitted to the hospital in the past few years, even as an outpatient, you’ve likely been asked if you have an advance directive or a health care directive. A Health Care Directive allows you to name a person, or persons, to make health care decisions for you if you are unable to do so at the time. It also puts in writing what your personal preferences are, not only with regard to your health care, but also:
If you have any spiritual or religious traditions that you would like your Agent to be aware of and act accordingly;
If you have wishes regarding cremation, burial, memorial services, funeral services and disposition of your remains; and,
If you would like to be an organ donor.
Having a Health Care Directive also gives protection to your Health Care Agent to not be liable for decisions made in good faith on your behalf. The last thing you want is one person saying that you want “X” and another saying you want “Y”, it not only puts those significant to you in a horrible position, but what you would want to happen won’t happen if no one knows exactly what your wishes are.
Who needs a Health Care Directive? Every adult should have a Health Care Directive. Contact MZ Law to schedule a meeting with one of our attorneys to discuss your health care directive and other estate planning needs.
Nothing rings in a new year like changes to tax law. This year’s changes will have significant impacts on many individuals’ and families’ estate plans. Changes to the taxation of retirement accounts, and gift and estate tax exemptions may mean your wills, trusts and beneficiary designations need an update.
Effective January 1, 2020, the Secure Act eliminated the use of the “Stretch IRA”. Many have used the “Stretch IRA” as a part of their estate plans to provide for their descendants while avoiding income taxation. Under the Secure Act, the rollover has disappeared. Now, instead of allowing a descendant to inherit a retirement account and stretch the distributions over their lifetimes, the retirement account must be distributed with 10 years or risk significant loss due to taxation at the compressed trust tax rates. If your estate plan utilizes the Stretch IRA, you must decide whether it is more important to protect the asset for the benefit of your loved one, or save on income taxes.
Other updates to note, effective January 1, 2020:
Increased federal estate/gift tax lifetime exemption: $11.58 million per individual ($23.16 million married) up from $11.4 million
Increased Minnesota state estate tax exemption amount: $3 million up from $2.7 million in 2019.
The annual gift tax exclusion has remained steady at $15,000 per individual ($30,000 married).
With these changes in mind, be sure take a moment to review your assets and consider your estate and financial planning needs. For those of you who already have a will or trust in place, please take a moment to review your documents and assets (on your own, or with an attorney at MZ Law) to determine how this years tax changes may impact your estate. For those of you who have “Make a Will” on your list of 2020’s New Year’s Resolutions, schedule a free estate plan consultation and we’ll share how to best plan your estate with the new laws in mind.