Posts by Inez Bowie, CPA, CSEP:
- Give you the final say over how your finances will be distributed.
- Establish who will be legally responsible for caring for your minor children.
- Help you avoid a drawn-out probate process.
- Provide you with an opportunity to minimize your tax burden.
- Let you determine who will be responsible for managing the affairs of your estate.
- I’m certain my boys now agree on one thing – that when they become professional sports stars (or whatever profession they choose), a will is a must have.
- They now know who Prince is and that he acquired a lot of money over the course of his career.
- Hopefully, they now have a basic understanding of the importance of a will. (I’m probably going to have to have a follow-up conversation about this one.)
Learn How A Will Protects Your Fortune After Death
While driving my sons to school this morning, we heard on the radio that, according to his sister, Tyka Nelson, music legend Prince died without having a will in place. This means, if the reports are true, Prince’s estate will be managed by a Minnesota probate court and will likely come with a large tax bill.
Naturally, this story has already generated national attention concerning the future of Prince’s multimillion dollar estate. What is certain, however, is that if Prince did die without having a will, his sister and five other half-siblings would stand to acquire a significant inheritance – after taxes, of course.
Read Also: You Can Still Have The Final Say After Death
Who Will Inherit Your Fortune?
I know that my sons truly love each other but, like most siblings, they fight like cats and dogs. So I decided to use the drive to school as a teachable moment.
Because both of my sons dream of becoming professional sports stars (let them dream), I advised them to heed the warning tucked within the morning’s news report. If you don’t want your brother to inherit your fortune when you pass away, you need to have a will in place that will determine where your millions go. Otherwise, the state will give everything to your next of kin.
Still Not Sure If A Will Is Necessary?
Regardless of how large (or how small) your fortune is, estate planning is essential and drawing up a will is a critical component of the plan – one you literally can’t afford to ignore. Among the many benefits of establishing a will, this document will:
You don’t have to be a teacher to pass along a few solid words of wisdom to your children. You just need seize teachable moments when they present themselves – even if all you can do is begin laying the groundwork for an even bigger lesson. Here’s what we accomplished on this morning’s drive:
Eh, I tried.
Would you like to learn more about estate planning and how to ensure your assets are distributed in accordance with your wishes after you die? Listen to episode 6 of unsuitable on Rea Radio with Dave McCarthy – The Grim Reaper Is Coming And He Wants Your Money. You can also email Rea & Associates to learn more.
By Inez Bowie, CPA, CSEP (Marietta office)
The following articles offer some more great advice about the importance of drawing up a will.
While your financial advisor is probably the last person you are thinking about during those romantic holidays, you may want to reconsider and here’s why …
You share the same financial goals.
Whether the topic of conversation is on your personal finances or your business’s financial wellbeing, your financial advisor genuinely cares about your current and future economic security. That’s why they are always looking for ways to save you money – not just during tax season, all year long. Read “Don’t Miss Your Chance to Secure Tax-Free Wealth” to learn about five tax savings strategies you may have missed.
They are not afraid to ask for help.
Because they want your future to be financially sound, your financial advisor is not only happy to call in outside reinforcements and other industry experts to weigh in on key financial decisions, they insist on it. It’s just not realistic for one person to have all the answers, especially in business matters, which is why your financial advisor likely has a contact list full of bankers, lawyers, real estate brokers, city officials and many other industry leaders and business experts. Read “Getting by with A Little Help from Your Friends” for tips to help you identify the right advisors to help you overcome your unique challenges.
They have your back.
From helping you identify ways to protect your business against fraud to helping you avoid spending more money than is necessary during large negotiations, your financial advisor is always looking out for your best interest. Are you looking for ways to prevent occupational fraud in your business or do you need to know the true value of a property you are interested in purchasing? Either way, your financial advisor has the expertise and experience needed to keep you from being taken advantage of. Check out the article “Are Your Employees Skimming from the Top?” and “How to Make Your Building Work for You with a Cost Segregation Study” for more insight into these topics.
They always have good advice.
It should go without saying that your financial advisor has worked with their fair share of business owners. So, when it comes to knowing the ins and outs of running a business, they have a lot of good advice and can give you some great insight into techniques that have worked as well as warning you about others that may have fallen short of meeting expectations. Your financial advisor may not always provide you with the answer you were looking for, but if you bring them into the conversation they will always be there to give you the sound advice you need. Listen to episode 18 of unsuitable on Rea Radio to hear a veteran financial advisor talk about the positive psychology of having hard conversations.”
Help is always right around the corner.
If you have a personal finance question or are in need of expert business advice, email Rea & Associates to speak with one of our expert financial advisors today.
By Inez Bowie, CPA, CSEP (Marietta office)
Are you looking for more business tips and insight? Subscribe to unsuitable on Rea Radio on SoundCloud or iTunes and listen to new podcast episodes every week. Listen to these episodes to learn more:
Summer is an exciting time for families. It’s a time to get outside and have fun hanging out by the pool or to catch fireflies in a jar at the end of a long day. For many parents though, the summer holiday is overshadowed by the need to find affordable childcare during your work hours. The good news is that your opportunity to claim the Child and Dependent Care Tax Credit doesn’t end at the last day of school. In fact, you may be able to claim a variety of summertime childcare expenses when tax season rolls around again. Check out the list below to familiarize yourself with this credit.
8 Tips To Help You Claim The Child Care Tax Credit
- Child care must have been provided so that you (and your spouse if filing jointly) can work or actively look for work. Your spouse must also meet this obligation during any month in which the child was a full-time student or was physically and/or mentally incapable of self-care.
- You must have earned income. Earned income includes earnings such as wages and self-employment. If you are married filing jointly, your spouse must also have earned income. There’s an exception to this rule for a spouse who is a full-time student or who is physically and/or mentally incapable of self-care.
- Care must have been provided for dependent(s) younger than 13 years old. Your spouse or another dependent qualifies if they lived with you for more than have the year and are physically and/or mentally incapable of self-care.
- Qualifying child care expenses include those that are used to secure enrollment at a daycare facility outside the home or at a day camp. Expenses for overnight camps or summer school tutoring do not qualify. NOTE: If you pay someone to come to your home to care for your child or children, you may be a household employer. For more information, see IRS Household Employer’s Tax Guide.
- If your employer provides dependent care benefits, special rules apply. See Form 2441, Child and Dependent Care Expenses.
- The credit is a percentage of the qualified expenses you pay for the care of a qualifying person and can be up to 35 percent of your expenses, depending on your income.
- You can claim up to $3,000 of your total unreimbursed expenses you pay in a year for one qualifying person or $6,000 for two or more qualifying persons.
- Keep your receipts and records to use when you file your 2015 tax return next year. Make sure to note the name, address and Social Security number or employer identification number of the care provider. You must report this information when you claim the credit on your return.
Email Rea & Associates to learn more about the Child and Dependent Care Tax Credit or other tax incentives you may qualify for.
By Inez Bowie, CPA, CSEP (Marietta office)
Just when you think your estate plan is complete, is it really? Your will gives your personal property to your daughter, Suzie. Great, Suzie gets your laptop and your smartphone. But what happens to your online accounts, emails, Facebook account, iTunes account, that special digital crown won in an online game, and digital pictures stored in the “cloud”? Does Suzie know where to find your usernames or passwords? Even if she does, does she have a right to access the accounts? Read the rest of this entry “
If you deal with trusts, you may soon feel the effects of new higher tax rates and the Medicare surtax. Unfortunately, the fiscal cliff deal was not kind to trusts, trustees or trust beneficiaries. For 2013, a trust will pay income tax at the highest individual tax rate of 39.6 percent when taxable income is more than $11,950. An individual would not pay at this highest tax rate until taxable income exceeds $400,000. In addition, the new 3.8 percent Medicare surtax on net investment income applies to trusts if taxable income exceeds $11,950. Read the rest of this entry “
Recently, Ohio eliminated the Ohio estate tax. The estates of individuals who die after January 1, 2013 will not be subject to the Ohio estate tax. Read the rest of this entry “
As we approach the end of 2012, there is much uncertainty regarding tax legislation. Tax rates, exemptions, credits and deductions are likely to change for both businesses and individuals, but no one yet knows which of the predicted changes will really come to pass. How do you prepare for this uncertain future? Take advantage of the 2012 rates while you still can and plan for contingencies in 2013 and beyond. Read the rest of this entry “
Recently, a reader shared with us that she inherited property in both Ohio and Florida. She had a pretty specific question related to the value of the Ohio property. That question made me think there may be more people who don’t know how to handle newly inherited property for estate tax purposes. Hence, I’m going to provide some general estate information I hope will help.
According to Ohio law, “the value of any property included in the gross estate shall be the price at which such property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.”
Now, let me put that in simpler terms. If there is real estate in an estate, then you need to claim its fair value. That value is the amount the property would sell for assuming both the buyer and seller know about the property and neither was pressured to either buy or sell. Read the rest of this entry “
It may not be the most romantic Valentine’s Day conversation, but financial planning is an important part of starting your marriage on solid financial footing. After all, married couples fight over personal finances more than they fight over anything else. Read the rest of this entry “
If you’ve been considering making a monetary gift to your children or other relatives, you may want to make your gift well before December 31. And better yet, if you haven’t made any previous gifts in 2011, you can gift up to $13,000 in 2011 and follow up with a gift of up to $13,000 in early 2012. Read the rest of this entry “
Dear Cousin Lauren is in a tough spot and she asked you for money. Again. Granted, she’s family and you want to help, but maybe she hasn’t made the best financial decisions in the past. What should you do?
It’s tempting to loan money to a friend or family member when times are tough. But whether Cousin Lauren asks you to float some cash “just this once,” or needs ongoing help that may impact your comprehensive estate plan, consider the following before you commit to an intra-family loan. Read the rest of this entry “