Investing in the future is a smart decision, but what happens if your future is cut short? A will is one way that you can invest in the future of your loved ones so that they never have to fight over real estate, investments and assets that you leave behind.
When you create a will, you’re choosing to break away from the 60% of Americans that leave the burden of estate managing in the hands of a lawyer, state or family member.
You can create a will online, or you can go to a lawyer that specializes in wills and trusts. The latter is the ideal choice when you have:
- Investments
- High net worth
- Real estate holdings
If you have nothing to your name, a will may be made online. The more complex the will, the better it is to go to a lawyer. A lawyer will be able to walk you through some of the tax advantages that you may be able to setup for family members, and they’ll ensure that the executor of the will has everything in place to divide your assets properly.
What to Consider When Making a Testament With Varied Investments
If you have varied investments, you may want to consider the following:
Foreign Tax Compliance Laws
If you have foreign bank accounts, you’ll want to work with a lawyer that has experience working in both countries. Israeli bank accounts, for example, are subject to FATCA Compliance which means that if you’re a US taxpayer or a foreign entity that has US taxpayers with substantial ownership, you will need to pay taxes in the US, too.
For example, if you have over $10,000 in financial accounts in Israel, the money will need to be reported to US tax authorities with the IRS expecting to collect 30% tax on the asset.
It’s in your best interest to work with an attorney or law firm that specializes in wills and trusts in Israel and the United States. The lawyer will have experience dealing with FATCA compliance and also helping to lower the tax burden on your loved ones.
Should You Create a Trust?
Trusts are a great option if you have a lot of assets to leave behind. Trusts can have tax advantages, and they can also help you put conditions on asset division. Perhaps you’re leaving your estate to your grandson which has been in recovery for years.
You can put a stipulation in the trust that only a certain portion of the assets will be distributed when your grandson is:
- 3 years clean
- 5 years clean
- 7 years clean
- Graduates college
Trusts can lower estate taxes, and they allow for the distribution of assets without delay and without costs involved in probate court.
Executors and Guardians
If you have minor children, you’ll want to make sure that you appoint a guardian in the event of your demise. The guardian you choose should be aware of the burden that she or he will shoulder upon your passing.
But you’ll also want to name an alternative guardian just in case the first passes away or has become incapacitated.
Executors should also be named, and these will be the family members or persons that you trust the most. This individual will be responsible for executing the will, and the best executor is someone that is familiar with fiscal matters.
The estate’s executor will be responsible for everything from executing the will to filing with courts and a variety of other legal tasks.
Special Circumstances
Circumstances change, and you do not have an obligation to leave anything behind to family members. If you have had a lifelong feud with your nephew, you can opt to leave him out of your will completely.
When you omit family members from a will, you should have it written down why the person has been omitted with a simple statement.
The reason for providing a statement on the matter is that the person that has been left out of the will can argue that they were omitted by error or mistake. If you clearly state that the person is not to benefit from your will, it will allow for an easier time executing your will and final wishes.
If you create a will today, you should update the will whenever new financial investments or matters arise. Perhaps you didn’t mention your stock in Amazon in the initial will because you’ve just purchased shares.
You can amend your will to include these new investments to ensure that they’re dispersed accordingly upon your demise.
Read over your will annually and have any changes made by a lawyer. You can even request that a person take care of your pets or livestock. You can also leave the continuation of your business in your will so that someone else will overtake your business.