How Does Re-marrying Affect My Estate Planning?
Re-marriage is a big life event, and can have a large impact on how your estate plan will be carried out. If you just had a will, a marriage or a divorce will invalidate a will or partially invalidate a will depending on your state’s laws. In certain life changing events, like marriage, divorce, birth of a child or death of a child, the state laws can change the way your estate will be distributed if you have a will. So it is important to always update your estate plan after a big life event. So, if you are re-marrying, it’s going to significantly affect your estate plan.
If you get re-married, and have a will or a trust you will need to update them to reflect how you want your assets distributed. You may want all your assets for your kids, but with a new spouse you may want to provide for them as well. All of these changes would need to be made to your will and trust to ensure your estate is distributed in the manner you truly want.
When It Comes to Estate Tax Planning, Is That Going to Be Any Different After the Divorce?
The short answer is, Yes. Currently, under Federal Estate Tax laws, you can give your spouse an unlimited amount of money, without paying any taxes. If you have a $100 million estate, you can leave it all to your spouse who doesn’t have to pay any estate tax on it.
If you have a large estate and it’s subject to paying estate taxes there are steps you can take to re-align your estate plan to make sure that there is not a large tax bill due after your passing. Thus, leaving more of your assets to those you want to receive it. James Gandolfini is a good example of poor tax planning. When he passed away, he was divorced, and he left a large sum of money to people (including his child) in a manner that didn’t avoid the estate tax.
What Estate Planning Documents Need to Be Update After a Divorce Is Final?
Generally speaking, the main documents that need to be updated after a divorce are a will, trust, financial power of attorney, medical power of attorney, any HIPAA releases, document releases and related documents. There will likely be other items that need to be updated depending on the individual’s specific situation. For example, do you have a joint checking account at the bank with your ex-spouse? Did you have a safety deposit box with your ex-spouse? These are the type of issues that can arise and are very subjective as everyone has a different situation.
Sometimes, the updates that you would think should happen during the divorce, never get completed because the divorce attorneys aren’t real estate attorneys or estate planning attorneys. While they might advise their clients to consult with an estate planning attorney there is usually very poor follow up to ensure those important documents have been updated. If you forget to make the proper updates to your estate plan, you can really leave yourself in a bad position or leave your ex-spouse in a very good position because they may still be the beneficiary of your estate.
Get answers to Frequently Asked Questions About Estate Planning And Divorce, or call the law office of Brian M. Douglas for an initial consultation at (770) 933-9009 and get the information and legal answers you’re seeking.
