Estate Planning
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Your Personal Values Legally Protected
The planning of one’s estate for the purpose of giving large gifts, creating a trust, or making a will is a project that calls for legal guidance, but also reflection on your personal history and human connections. It presents an opportunity to think about what matters most in your life and truly express your values. Often, people walk away from the estate planning process with a clearer understanding of who they are, the people they trust when difficulties arise, and how they feel about ethical issues involving social and family responsibility.
Paul has helped people from all walks of life plan their estates, including business owners, fellow lawyers, economists, top American athletes, and both state and federal government employees, among others. To achieve client goals, he considers a broad range of contingencies both at the individual and interpersonal level. He asks clients to anticipate possible decisions that relatives (including future generations) or other cherished persons could someday be required to make.
He also helps clients think about how laws might change over time, how economic or political conditions might affect their personal finances, and how best to preserve the net value of their estates. He treats every client with empathy and respect while helping to formalize their wishes for loved ones and broader legacies in a legally enforceable format.
Paul has helped people from all walks of life plan their estates, including business owners, fellow lawyers, economists, top American athletes, and both state and federal government employees, among others. To achieve client goals, he considers a broad range of contingencies both at the individual and interpersonal level. He asks clients to anticipate possible decisions that relatives (including future generations) or other cherished persons could someday be required to make.
He also helps clients think about how laws might change over time, how economic or political conditions might affect their personal finances, and how best to preserve the net value of their estates. He treats every client with empathy and respect while helping to formalize their wishes for loved ones and broader legacies in a legally enforceable format.
Tax Planning Can Make a Big Difference
Sizeable estates above a certain threshold are subject to taxation at the federal level, as well as by the District of Columbia and Maryland governments. Anywhere from a few thousand to millions of dollars in taxes may hinge on just a few hours of proper estate tax planning. Most clients can have their estates planned in as little as two sessions.
Currently, the lifetime exemption per individual person is $10 million indexed for inflation, which amounts to $11.2 million. Couples enjoy double the exemption, which amounts to a grand total of $22.4 million. The exact amount of money that can be saved depends on the size of your estate; the value of large gifts you (and your spouse) have made throughout life; and how lawmakers choose to exercise their broad discretionary powers.
Suppose that in 2018 someone bequeaths $10 million to a child or spouse and passes away the same year. That person will avoid paying taxes entirely. Under the old exemption, only the first $5.49 million would have been exempted; the rest would have been taxed with a top rate of forty percent. Because tax exemptions can vary from year to year, one cannot rely exclusively on the current state of the law, unless making transfers of wealth in the very near future.
Some prominent lawmakers have called for lowering the federal exemption to $3.5 million or lower, which would mean shrinking the current exemption to about a third of its size. Prior to reforms enacted in 2014, the respective local and state exemptions in the District of Columbia and Maryland were merely $1 million. Eventually, D.C. and Maryland changed their laws because of competition from more tax-friendly states like Virginia.
Paul can work in conjunction with accountants, financial advisors, or wealth managers to create plans that reflect the “on the ground” financial situations of his clients. With insight into how client’s personal finances may evolve over time and understanding of how laws also change, Paul devises strategies to improve client’s chances of paying only the bare minimum taxes required by law.
Currently, the lifetime exemption per individual person is $10 million indexed for inflation, which amounts to $11.2 million. Couples enjoy double the exemption, which amounts to a grand total of $22.4 million. The exact amount of money that can be saved depends on the size of your estate; the value of large gifts you (and your spouse) have made throughout life; and how lawmakers choose to exercise their broad discretionary powers.
Suppose that in 2018 someone bequeaths $10 million to a child or spouse and passes away the same year. That person will avoid paying taxes entirely. Under the old exemption, only the first $5.49 million would have been exempted; the rest would have been taxed with a top rate of forty percent. Because tax exemptions can vary from year to year, one cannot rely exclusively on the current state of the law, unless making transfers of wealth in the very near future.
Some prominent lawmakers have called for lowering the federal exemption to $3.5 million or lower, which would mean shrinking the current exemption to about a third of its size. Prior to reforms enacted in 2014, the respective local and state exemptions in the District of Columbia and Maryland were merely $1 million. Eventually, D.C. and Maryland changed their laws because of competition from more tax-friendly states like Virginia.
Paul can work in conjunction with accountants, financial advisors, or wealth managers to create plans that reflect the “on the ground” financial situations of his clients. With insight into how client’s personal finances may evolve over time and understanding of how laws also change, Paul devises strategies to improve client’s chances of paying only the bare minimum taxes required by law.
Business Succession Planning
When businesses are successful, the owners often wish for those same businesses to continue providing value for their families. In the case of small or large businesses, a retiring founder may wish to pass on his proud creation to someone capable of directly carrying on the legacy.
However, transferring shares in a corporation or partnership is not quite as easy as gifting someone a piece of property. Even if you own 100% of the business, as is often the case in small family-run businesses, there are still many complications that can arise. That is why estate planning for business owners can be indispensable.
While transferring ownership and control of a company, you want to avoid mistakes that could damage the company’s value at this critical stage in the life of a business. For example, essential operations should continue smoothly, costly legal battles should be avoided or their chances minimized, and where applicable exposure to creditors should be reduced.
For an attorney to help you accomplish these goals, you need to record your wishes clearly in a format that the law is prepared to recognize. The attorney can help you craft express language that protects your interests, as well as those of your heirs.
Last, but certainly not least, is the issue of how transferring ownership of a business might affect the value of your estate for tax purposes. Sometimes, the unexpected high valuation of a business requires families to deal with probate proceedings and make private finances a matter of public record. Moreover, the government may seize a substantial portion of assets, which may be essential to running the business smoothly.
Fortunately, there are steps many business owners can take to minimize the chance of probate proceedings and reduce the tax burden faced by heirs. This is why your business succession plan should be considered as part of a comprehensive strategy, which includes tax planning. You may also want to examine other legal services for businesses.
However, transferring shares in a corporation or partnership is not quite as easy as gifting someone a piece of property. Even if you own 100% of the business, as is often the case in small family-run businesses, there are still many complications that can arise. That is why estate planning for business owners can be indispensable.
While transferring ownership and control of a company, you want to avoid mistakes that could damage the company’s value at this critical stage in the life of a business. For example, essential operations should continue smoothly, costly legal battles should be avoided or their chances minimized, and where applicable exposure to creditors should be reduced.
For an attorney to help you accomplish these goals, you need to record your wishes clearly in a format that the law is prepared to recognize. The attorney can help you craft express language that protects your interests, as well as those of your heirs.
Last, but certainly not least, is the issue of how transferring ownership of a business might affect the value of your estate for tax purposes. Sometimes, the unexpected high valuation of a business requires families to deal with probate proceedings and make private finances a matter of public record. Moreover, the government may seize a substantial portion of assets, which may be essential to running the business smoothly.
Fortunately, there are steps many business owners can take to minimize the chance of probate proceedings and reduce the tax burden faced by heirs. This is why your business succession plan should be considered as part of a comprehensive strategy, which includes tax planning. You may also want to examine other legal services for businesses.
Trusts to Protect Those You Love
A trust is one of the main legal vehicles for minimizing estate taxes, but it also serves many other purposes. When you create a trust, you are trusting another person (or corporation) called a trustee to hold particular assets for the benefit of a third party, called a beneficiary. Depending on the details of the agreement with the trustee, you may control when and under what conditions distributions are made from the trustee to the beneficiary.
Creating a trust is one of the main reasons why people hire attorneys with estate planning experience. There are many kinds of trusts in the District of Columbia and Maryland; and each kind serves a unique purpose. For example, you can use trusts for the following reasons:
The above list is not intended to be exhaustive; there are other projects you can undertake using trusts as a legal tool. If you need some assets to be managed for a purpose not listed here, you should discuss the matter with an attorney.
Creating a trust is one of the main reasons why people hire attorneys with estate planning experience. There are many kinds of trusts in the District of Columbia and Maryland; and each kind serves a unique purpose. For example, you can use trusts for the following reasons:
- Prevent spendthrift heirs from depleting their inheritance.
- Protect the assets of your estate from creditors and frivolous lawsuits.
- Provide a quality of life for a loved one in the event that something happens to you.
- Protect the interests of minors who cannot yet claim their inheritance.
- Avoid probate proceedings and associated court costs, appraiser’s fees, and legal fees.
- Reduce the size of your estate to bypass or minimize taxation.
- Provide resources to a charitable cause or other cause you personally find meaningful.
- Providing for the care of a pet animal.
The above list is not intended to be exhaustive; there are other projects you can undertake using trusts as a legal tool. If you need some assets to be managed for a purpose not listed here, you should discuss the matter with an attorney.
Retirement Planning Legal Strategy
Saving for retirement is not just a good idea; it is a necessity. The Social Security Administration admits that the government cannot guarantee a comfortable retirement and recommends use of private pensions, savings, and investments to make up the difference between what the government can provide and what you really need for comfort.
It is generally the role of a financial advisor or wealth manager to help you pick the right investments to secure your retirement, though exceptionally well-informed people may decide to make their own choices. An attorney can help with critical issues such as explaining the tax advantages of different retirement accounts, in conjunction with the sensitive timing of making withdrawals, and how your retirement plan may affect non-financial goals such as avoiding probate, preserving your privacy and minimizing government fees and legal expenses.
The earlier you start saving the more benefits are likely to accrue when the time comes to cash out. Young professionals should start saving for retirement as soon as they get a job or start making a profit covers more than basic living expenses.
Whether you have questions about a traditional IRA, 401(k), 403(b), Roth IRA, or some other account, Paul can help you understand the relevant rules, as well as how those rules can affect your personal finances.
Paul also has experience with Self-Directed IRAs (SDIRAs), which can benefit people who want to diversify their retirement assets, for example to hedge against the stock market. Such assets may include real estate, precious metals, private businesses, and even cryptocurrencies such as bitcoin and ethereum, among many other types of investments.
Most kinds of investments under a SDIRA are administered by a custodian or trustee. For certain types of investments, you will want an attorney to explain the accepted uses and tax implications of investing using this method.
It is generally the role of a financial advisor or wealth manager to help you pick the right investments to secure your retirement, though exceptionally well-informed people may decide to make their own choices. An attorney can help with critical issues such as explaining the tax advantages of different retirement accounts, in conjunction with the sensitive timing of making withdrawals, and how your retirement plan may affect non-financial goals such as avoiding probate, preserving your privacy and minimizing government fees and legal expenses.
The earlier you start saving the more benefits are likely to accrue when the time comes to cash out. Young professionals should start saving for retirement as soon as they get a job or start making a profit covers more than basic living expenses.
Whether you have questions about a traditional IRA, 401(k), 403(b), Roth IRA, or some other account, Paul can help you understand the relevant rules, as well as how those rules can affect your personal finances.
Paul also has experience with Self-Directed IRAs (SDIRAs), which can benefit people who want to diversify their retirement assets, for example to hedge against the stock market. Such assets may include real estate, precious metals, private businesses, and even cryptocurrencies such as bitcoin and ethereum, among many other types of investments.
Most kinds of investments under a SDIRA are administered by a custodian or trustee. For certain types of investments, you will want an attorney to explain the accepted uses and tax implications of investing using this method.
Healthcare Choices that Are Right for You
No overview of estate planning would be complete without discussing the advance healthcare directive or “living will”. Unlike other provisions of law discussed above, the living will is not primarily about money (though prolonged hospitalization and treatment for terminal conditions can be expensive, and many clients would rather avoid unnecessary suffering).
Paul recommends using the standard forms provided by the District of Columbia or Maryland governments respectively, in order to avoid confusing hospital staff. As your attorney, he can help you understand the meaning of the provisions on each page of the living will. You should also discuss these matters with loved ones, especially if you intend to give them the right to make medical decisions on your behalf in some possible situations.
Paul recommends using the standard forms provided by the District of Columbia or Maryland governments respectively, in order to avoid confusing hospital staff. As your attorney, he can help you understand the meaning of the provisions on each page of the living will. You should also discuss these matters with loved ones, especially if you intend to give them the right to make medical decisions on your behalf in some possible situations.