How Often Should You Update Estate Planning Documents in Minnesota?
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Your Minnesota estate planning documents should be reviewed and updated every so often. Learn when you should complete this task here.
Do you have an estate plan? If you don’t, you could end up leaving loved ones in a bad situation.
Setting up an estate plan is an important step that everyone needs to take sooner or later. In fact, only 67% of Americans have an estate plan in place.
Although everyone is at different points in their lives, the moment to plan for your future passing is now! Your estate documents last beyond when you pass. They also protect your family while you’re still here too.
Your next step should be contacting a knowledgeable estate planning lawyer in Minnesota. Read on for the best answers to questions about estate planning and how often you should update your documents.
Understanding the Need to Update Estate Planning Documents in Minnesota
It is important to update your estate planning document when things are all set in your life so that you are prepared.
This is what will protect your assets and ensure that all your wishes are carried out after death. If there is not an estate plan, then your family or your loved ones may have a lot of trouble figuring out whose things are whose and what to do with everything that you owned.
Not only will this protect your assets, it will also help you to avoid family conflict after you are gone. In fact, family disputes over a will are extremely common. But, of course, you want to avoid this as best as possible.
But that’s not the only two reasons to update your estate planning documents. An estate plan can also help you to minimize taxes for your assets in the way that you choose to distribute them.
Recent Legal Changes Impacting Estate Planning in Minnesota
There are a few recent legal changes to be made aware of when it comes to estate planning.
For starters, the Minnesota estate tax exemption increased to $3 million – a $300,000 increase from 2019. That means that any estate less than $3 million will not have to pay taxes.
Another law, the Secure Act, also impacts estate planning. This states that any non-spouse beneficiaries of an inherited IRA must be withdrawn within 10 years of the enactment of the estate plan.
There is also a new outline for how digital assets are distributed after a death. Individuals can grant fiduciaries access to digital assets such as social media accounts or email. This can be beneficial if there is a family business with a lot of information in the digital assets.
The Minnesota Uniform Trust Code provides a framework for the creation, modification, and termination of trusts.
Minnesota can also recover funds from Medical Assistance recipients who have passed away. However, a new law places a limit on how much can be recovered through an estate plan.
When It’s Time to Amend Your Estate Planning Documents
There are several times that you should amend your estate planning documents throughout your life. Here are some of the bigger reasons to update them.
Changes in Circumstances
If you have any changes in personal or family circumstances, such as a marriage, divorce, or you have children, it is time to update your estate plan. This plan must reflect these changes in order to be up-to-date.
If you also have a change in financial circumstances (or gain more assets or sell an asset such as a house), your estate plan needs to reflect this.
Changes in Minnesota Law
Keeping track of estate planning laws is an important thing to do when it comes to your estate plan. Laws regarding planning, taxes, and probate often change.
Reviewing your estate plan every once in a while will ensure that you are in compliance with Minnesota laws.
This can be tricky to do on your own, though. That’s where hiring an estate planning attorney can come into play. They can help you navigate your estate plan to ensure that it is all up-to-par with Minnesota law.
Changes in Health
Changes in your health is a very important reason to update your estate plan. This is especially true if your health declines or you come disabled.
You need to make sure that your estate plan accurately reflects what you want to happen when you are no longer able to make the decisions yourself.
Determining How Frequently Estate Planning Documents Need to be Up-to-Date
While ensuring that you change your estate plan is a must when life events happen such as changes in health, life circumstances, or Minnesota law, there is also another general rule of thumb.
You should plan to update your estate plan every few years if you do not experience any of the other criteria. Even if nothing in your life changes, you may experience a change of heart that may dictate your wishes in your estate plan.
Taking Proactive Steps to Keep Estate Planning Documents Current
Estate planning documents are some of the most important documents that you need to have. And waiting too long can be a huge mistake.
You never know what’s going to happen, so it’s important to be prepared – for yourself and for the ones that you love. This can help to prevent family disputes, ensure that your family is set, protects your assets, and can even minimize the taxes on your assets.
If you are ready to get started with estate planning, you can contact Johnson/Turner Legal today! We can help you get to where you need to be.