Reporting Dee Lee
Reporting Dee Lee
BOSTON (CBS) – Six months south and six months north could be a great life style in retirement but one place will need to be your legal domicile, your legal residence.
And it’s the laws of that state which will dictate your estate planning. Basically, you will need to decide which state would be advantageous to die in.
The Federal exemption, the amount you can give away without incurring federal estate taxes has been suspended for this year and for next year the number is $1million. Stay tuned for I believe that may change.
Check the estate tax laws of the state you are considering moving to. Many states
are now implementing an estate tax upon the death of their wealthy residents.
Massachusetts changed their estate laws several years ago, and for Massachusetts
the exemption is $1 million. So if your estate is larger than $1 million you could
owe Massachusetts estate taxes. Florida, always wanting to lure more residents
from the north, does not have an estate tax.
You may own property and pay real estate taxes in both states, have bank
accounts in both states, register cars in both states, buy insurance in both states
but you really only live in one state and you are visiting the other state.
Owning property in different states may require your heirs to go through the
probate process upon your death in more than state. Setting up a trust and
having the trust own the real estate may make the transfer of property easier
upon your death.
Snowbirds should also consider executing Durable Powers of Attorney for
each state so if they do need legal or financial decisions made by another the
documents are in place to help. This is especially important if you have property
or banking accounts in both states.
Last, be sure you have an Advance Medical Directive for both states. These are
simple documents to execute. In Massachusetts it’s your Health Care Proxy and
if Florida is where you spend your winters you want to execute a Living Will and
within that document you appoint someone to make medical decisions for you.
Terri Schiavo of Florida was an example of the best intentions gone astray.
Her husband and her parents fought in court about her care. The governor got
involved. I don’t care which side of the argument you were on regarding her
feeding tube, just be sure you do your planning so your family is not fighting your
battles in a court room.
Read more at: boston.cbslocal.com