There are many reasons why someone might not think about estate planning or take proactive steps to support estate planning in New York. Unfortunately, failing to plan makes it difficult to ensure that your wishes are honored. A sudden diagnosis or accident may render you unable to articulate these wishes in estate planning documents. If you don’t take any steps to plan, you might leave your estate distribution up to the state of New York.
You may be wondering whether or not a last minute decision to transfer something in your estate is a good decision. The truth is that in most cases, it is not a good idea to transfer assets out of your name right before you pass away.
There are very few states that still have an inheritance tax, so that is unlikely to apply. If you have property in multiple states, however, make sure you review that and determine if taxes are applicable in any states. Of course, if you do have a large estate, this may still be subject to federal estate tax, but those situations are the exception in which taxes apply. You may be assuming that it’s a good idea to get rid of these assets at the last minute to avoid probate.
The truth is that working with a qualified estate planning attorney can introduce you to many other better ways to avoid probate. For example, imagine that you run a family business worth a few hundred thousand dollars. If this is built on substantial land, such as in the case of a family farm, much of the barns and buildings have depreciated. If this was gifted at the last minute to family members and they sell it, then they would pay capital gains on that total amount which could be as high as 20%. Speak to a qualified estate planning attorney in NYC to discuss better and more appropriate methods of transferring assets.