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Estate planning conversations for families

Many people in New York carefully plan their finances for the future including the inheritance allocation. However, numerous people find the subject of discussing inheritance uncomfortable and difficult to approach. Elderly parents may avoid the conversation because discussing a death can be uncomfortable, and other family members might not want to appear greedy and insensitive. In many cases, many families do not discuss the issue.

A recent article suggests that family disagreements over the distribution of wealth may occur more frequently if the pan is not discussed prior to its execution. It is therefore important to inform the heirs ahead of time and explain the reasons why the wealth is allocated in a certain way. This may avoid family conflicts and expensive legal fees down the road.

Unforeseen circumstances are another important reason why discussing estate planning with family members can be beneficial. In many scenarios, when the parent passes away without proper financial plan in place, their children's welfare may be put at risk, especially when a beneficiary in not able to handle money well. This might result in devaluation of assets because they may be subjected to different taxes, including estate tax and income tax.

In addition to discussing possible plans for the distribution of assets with family members and potential heirs, it might also be beneficial to discuss estate planning with an attorney. An attorney may be able to help a client create a strategy for minimizing taxes and preserving wealth while drafting the documents necessary for disrupting assets according to the benefactor's wishes.

Source: NASDAQ, "Expensive Consequences of Not Having the Dreaded Inheritance Conversation ", August 23, 2014

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