Estate plans have to be altered and changed over the years to ensure they align with laws and your needs. Recently the estate tax laws were changed at the federal level. These changes may affect you if you are a high-income earner or have a large estate in Tennessee. Basically, this means it is time to review your estate plan and see what changes you need to make.
CNBC explains the changes come as a result of the Tax Cuts and Jobs Act. Changes were made concerning exemptions, tax brackets and deductible expenses. The biggest concern is your heirs being taxed a large amount when you die and assets roll over to them. This is especially true if you have an estate worth over $11 million if you are single and $22 million if you are married.
One suggested change you may want to make is to give heirs expensive assets as gifts now to avoid huge tax hits in the future. In addition, you may want to convert your traditional IRA to a Roth IRA. While you cannot take contributions as a deduction on your taxes, you can avoid paying a lot of tax in the long run. You probably will end up saving more by converting. Also, consider using trusts in your estate plan to avoid tax hits.
Keep in mind that most changes under the Tax Cuts and Job Acts are temporary. So, if you do not have a large estate, then you probably do not need to worry about making any changes to your estate. This information is for educational purposes and is not to be taken as legal advice.