Nearly 110,000 Ohio residents die each year, and many of them do not have even the most basic estate planning documents in place to protect their family and loved ones. An individual who dies without a will is said to have died “intestate.” Dying intestate results in your estate being distributed according to Ohio law, which is often very different than what you would have wanted. So if you haven’t prepared a will or estate plan, you should. But if you have taken the time to prepare a plan, the next logical question is, “How often should I redo my will?”
As a general rule your will or living trust, along with your other estate planning documents, should be reviewed at least every five years. However, there are certain situations that may necessitate an earlier review, such as:
- A Change in the Law. The American Taxpayer Relief Act of 2012 (ATRA), which permanently increased the federal estate tax exemption to over $5 million per person and created portability of the Federal Estate Tax Exemption drastically changed the estate planning landscape. Additionally, Ohio eliminated the Ohio Estate Tax beginning in 2013. These changes in the law could create new planning opportunities that weren’t previously available.
- Good Fortune. Whether you won the lottery, made a great investment or inherited a substantial amount from a family member, it is now time to review your estate plan. You may want to look at shifting some of your wealth to younger generations or you may want to revise your plan so your children or grandchildren don’t receive quite such a substantial amount of wealth in a lump sum upon your death. This is also a good time to review the income and estate tax ramifications of your good fortune.
- Increased Risks. Maybe you’ve started a successful business or have become fearful of law suits against you. If so, the Ohio Legacy Trust, which allows an individual to establish an Ohio Asset Protection Trust, might be something to consider. An Ohio Legacy Trust allows an individual to protect certain assets from future lawsuits and creditors, while maintaining the use and benefits of those assets. There are some very specific requirements that must be met to achieve the desired protection.
- Changes In Your Family. If you get married, get divorced or separated, have children or became a grandparent, you should not delay making necessary changes to your estate plan.
Paul Kellogg is a lawyer with Phillips Law Firm, Inc., whose practice focuses on estate planning, probate and representing entrepreneurs and business owners. He can be reached at (513) 985-2500.