An essential but often overlooked part of estate planning in Mount Laurel involves the naming of one’s beneficiaries: people or organizations that will inherit property after a person’s death or at any other point in the future.
Individuals have the universal right to nominate any party that they wish to be a beneficiary. However, people should understand that a beneficiary is not always legally permitted to inherit a set of assets. Furthermore, the selection of certain beneficiaries could have significant tax implications.
If you need help understanding the intricacies of beneficiary designations in estate planning, an experienced Mount Laurel attorney could assess your situation and outline your options. A dedicated estate planning lawyer could assist with drafting common testamentary documents like wills and trusts.
Choosing a Beneficiary and New Jersey’s Intestacy Statute
One of the most substantial benefits of creating an estate plan is being able avoid the application of the state’s intestacy statutes. This collection of laws determines what will happen to a person’s property should they die without a will. For example, New Jersey Revised Statute § 3B:5-4 outlines which parties will receive a decedent’s property if they pass away before drafting a will, creating a thorough estate plan, or having a surviving spouse.
Because of these rules, it is extremely important to have a detailed and legally valid will. Choosing one or more beneficiaries is a vital part of the will creation process, especially when a chosen heir is a child of the executor. Since children cannot directly inherit property, it goes into the care of a guardian until the child reaches adulthood. Selecting beneficiaries carefully allows an individual to protect the assets that they care about most. A Mount Laurel attorney could provide more information on how to make beneficiary designations that interact well with the state’s intestacy statutes.
Beneficiaries and Tax Ramifications
It is important to understand that New Jersey no longer levies an estate tax upon a decedent’s property. However, many other states and counties still implement these policies. They sometimes also enforce a related inheritance tax that forces beneficiaries of wills to surrender a portion of the assets that they collect. These taxes could result in an estate losing a significant percentage of its value.
When making beneficiary decisions, Mount Laurel residents and their attorneys need to recognize the impact that estate and inheritance taxes will have on one’s designated beneficiaries. For instance, if a beneficiary lives in a state or county that still taxes an inheritance, an decedent’s property might lose value when it is reallocated to heirs. A legal representative could explain inheritance tax laws in greater detail and help minimize the impact that local regulations have on the value of an estate.
A Diligent Mount Laurel Attorney Could Help Make a Beneficiary Designation
Generally speaking, an estate plan will have at least one beneficiary, the person named in a will or trust to inherit a specific property. A collection of state laws impact who is eligible to become a beneficiary and whether that nomination will carry tax implications.
A nearby lawyer could be a valuable asset if you are navigating the process of making beneficiary designations in Mount Laurel estate planning. Legal representatives could determine who is eligible to inherit your assets and advise you if those parties might face high taxes on the inheritance. Contact the office today for a consultation.