Hello Fellow Taxpayers,
I hope you have some fun plans for this weekend’s Memorial Day. Unfortunately, a good friend of the Treasure Coast, David Guizerix or Rainbow Dave to those that knew him passed away this past week. I will not go into the details, but Dave was young, way too young to pass on. He left a loving wife and adoring children, not to mention other family and more friends than almost anyone I know. He had a good business, which Ali and I took advantage of on more than one occasion.
As I think about Dave, it reminds me of how unexpected things can happen. Are you prepared for the unexpected? There are several things that you should implement; perhaps things that you may have thought about, but have put off or maybe thought it was not really needed. The following is my list of items to consider(not in any order):
a) Will or trust: If you have family, especially a blended family, you should have, at the very least, a will. You still may have to go through probate (at least in Florida), but a will, will dictate how you want your assets to be distributed. I am not an attorney, as you well know, but you should consult with one. You can create a will on your own, but why would you?
You may also think about creating a trust, and there are many different kinds. I can help with the tax side, but an attorney should be consulted to set it up. And a trust may help you by-pass probate. What is probate? I suggest you access the link about Florida Probate to give you some insight (https://www.flcourts.org/Resources-Services/Court-Improvement/Family-Courts/Family-Law-Self-Help-Information/Probate). If you are not in Florida and are reading this, please check your state’s rules for details. And as a point of additional information, going through probate is not a cheap endeavor (lawyer’s fees).
b) Health Insurance: Are you required to have some health insurance, per the tax law, yes, but there will not be any penalties in 2019. However, even if it does not have “minimum essential coverage,” you need to have something in case of a catastrophic event.
c) Life and/or Disability Insurance: I am not talking about millions of dollars, though your beneficiaries will love you for it, but at least something to help the ones you leave behind. You should have something to pay off your mortgage, your funeral costs, etc. so that your loved ones are not left holding the bag. There are so many types, including term, where the annual payment is not prohibitive. There are also some types of policies that have disability riders that allow you to use the benefit now if you need it, or in case you become disabled and cannot work. It does reduce the death benefit, but it is a cheaper alternative than having two types of insurance
d) Living Will: A living will, also called a directive to physicians or advance directive, is a document that lets people state their wishes for end-of-life medical care, in case they become unable to communicate their decisions. You appoint a health surrogate, who is an adult that you already have selected, to make healthcare decisions for you when you become unable to make them for yourself. It removes the stress from the family to decide what you may have wanted.
e) Re-titling assets and other investment accounts: this can be as simple as re-titling an account “in trust for.”, POD (paid on death), or TOD (transferred on death). Even becoming a joint owner helps in the transfer of wealth and may by-pass probate (see above). You may actually be able to transfer the asset (home and cars) to a trust. Again, your lawyer, your financial adviser, and tax professional should be consulted.
I am sure that there are other things I am not mentioning here as everyone’s personal history/future is unique. As a tax professional, I have forged relationships with many other professionals that can help you with all of the above. Let me know if I can help directly or if you need a referral or two or three.
I am here to help should you have any questions.