How the OBBBA Impacts Charitable Giving and Estate Planning

December 10, 2025

With the passage of the One Big Beautiful Bill Act, we now have certainty about future tax rates and brackets, increased tax exemptions and increased state and local income tax deductions. A recent article, “Charitable Planning Under OBBBA: Key Considerations for Advisors and Donors in 2025,” from the American Heart Association, provides a wealth of information about how the OBBBA impacts charitable giving and estate planning under the new tax law.

The standard deduction increased for 2025, and seniors now get an enhanced deduction of $6,000 for anyone age 65 or older. And starting in 2026, if you itemize, charitable contributions are subject to a .5% floor based on Adjusted Gross Income. Only donations exceeding 0.5% of AGI are deductible.

For example, let’s say a married couple has an AGI of $200,000. They donate $10,000 to qualified charities. The deduction is reduced by 0.5% of $200,000, or $1,000. The allowed charitable deduction amount is $9,000.

For those who don’t itemize, starting in 2026, there will be a partial charitable contribution deduction. Unmarried taxpayers can claim up to $1,000, and married taxpayers may claim up to $2,000 as a charitable deduction on top of standard deductions.

What should philanthropically minded people do? Consider front-loading charitable gifts before the new limitations become effective. Take advantage of Donor Advised Funds (DAFs). If appropriate, consider the Qualified Charitable Distribution (QCD).

Transferring appreciated securities to a DAF is an effective way to get a deduction for the securities’ value now and donate to charities later. As markets are currently at record highs, there may be unrealized gains in stocks, mutual funds and ETFs. Transferring appreciated assets from a brokerage account directly to a DAF also avoids capital gains on the unrealized gains. Donations to specific charities from the DAF can be made later. Just be sure that enough appreciated securities are transferred to itemize. Transfer more than the amount of the standard deduction—known as “lumping” deductions. Do this in 2025 before limitations begin.

If you’re 70 ½ or older, talk with your estate planning attorney about the wisdom of making all charitable contributions directly from your IRA to the charity. Doing so has many benefits.

The QCD (Qualified Charitable Distribution) fulfills the Required Minimum Distribution. Let’s say that your RMD is $20,000 and you don’t need it, and plan to donate it to a charity you care about. By giving the $20,000 directly from the IRA to the charity, you’ve fulfilled your RMD requirement and removed the $20,000 from taxable income.

By reducing taxable income, you may reduce Medicare premium surcharges or any other AGI/taxable income considerations. The maximum QCD in 2025 is $108,000, and there is a once-in-a-lifetime QCD rollover of up to $54,000 for 2025 into a Charitable Gift Annuity.

Another tool to consider is the Charitable Gift Annuity, or CGA. Cash or appreciated securities may be used to establish the CGA, which creates a tax deduction for the present value of the gift and lifetime income for you and a beneficiary. A portion of the revenue is tax-free, and the rest is ordinary income. If appreciated securities are donated, a portion of the income will be treated as capital gains. The charity receives the remainder of the annuity upon the death of the last beneficiary.

These are good ways to do good while reducing your tax bills in 2025. Talk with your estate planning attorney so you have a good understanding of how the OBBBA impacts charitable giving and estate planning, as 2026 will present limitations for charitable deductions. If you would like to learn more about charitable giving and tax law, please visit our previous posts.

Reference: American Heart Association (Nov. 13, 2025) “Charitable Planning Under OBBBA: Key Considerations for Advisors and Donors in 2025”

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Far More Risks than Benefits to a DIY Will

December 8, 2025

In an age where everything from taxes to home sales can be handled online, it’s easy to believe that creating a will should be just as simple. However, when it comes to estate planning, shortcuts can lead to devastating consequences. DIY wills created without legal oversight may appear valid on the surface, yet fail under scrutiny, leaving families tangled in disputes and estates tied up in probate. True legacy protection requires precision, foresight and experienced guidance. There are far more risks than benefits to a DIY will. Don’t risk losing your legacy.

Why DIY Wills Often Fail

Every state has its own requirements for what makes a will legally enforceable. A simple oversight, such as a missing signature, improper witnessing, or unclear language, can invalidate the entire document. Online templates and handwritten forms rarely account for the nuances of state law or the complexities of blended families, business ownership, or significant assets.

Common Problems with DIY Wills

Ambiguous wording: Generic phrasing can lead to disputes over interpretation.
Outdated information: DIY documents often go unreviewed as family or financial circumstances change.
Incorrect execution: Missing witnesses or notarization can render the will invalid.
Failure to plan for contingencies: Many DIY wills lack provisions for alternate beneficiaries or executors.

When mistakes like these occur, the court decides how assets are distributed — not you.

The Hidden Costs of Saving Money

Many people turn to DIY wills to avoid legal fees. However, those initial savings often pale in comparison to the cost of fixing mistakes later. Heirs may face:

Lengthy probate delays
Costly legal challenges
Family conflict over unclear instructions

In some cases, the estate’s value can shrink significantly due to litigation and administrative costs, erasing what the will was meant to protect.

Experienced Estate Planning Offers True Security

An estate planning attorney ensures that every clause of your will aligns with current law and your personal goals. They will explain how there are more risks to a DIY will than benefits. They also coordinate other critical documents, such as trusts, powers of attorney and advance directives, to create a cohesive plan. This holistic approach reduces confusion, prevents disputes and provides continuity if circumstances change.

Protect Your Family from Unintended Consequences

A will is a legal expression of your final wishes. Experienced estate planning transforms your intentions into legally sound documents that stand up in court and keep your loved ones out of conflict. Working with an experienced probate and estate attorney ensures that your legacy remains intact, your assets are distributed as intended and your family avoids unnecessary hardship. If you would like to learn more about the pitfalls of DIY planning, please visit our previous posts.

Reference: Forbes (July 29, 2019) “Why Writing Your Own Will Is a Bad Idea”

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Incorporating Trusts into Your Gifting Strategy

December 2, 2025

Giving assets to family members or grandchildren during your lifetime can be deeply rewarding. It also requires careful planning to avoid tax consequences and protect the gift’s long-term value. Trusts offer a way to make gifts strategically — ensuring that they are managed wisely, shielded from misuse and distributed according to your wishes. By incorporating trusts into your gifting strategy, you can balance generosity with foresight.

The Purpose of Gift Trusts

A gift trust allows you to transfer assets out of your estate, while still controlling how and when those assets are used. Unlike direct gifts, which are transferred to the recipient immediately, assets in a trust are managed by a trustee who follows the instructions you set. This enables support for younger beneficiaries, safeguarding funds and minimizing estate or gift taxes.

Gift trusts can serve many family and financial purposes, such as:

Education funding: Set aside money for tuition or college expenses.
Generational wealth planning: Transfer assets to children or grandchildren without triggering large tax bills.
Protection against misuse: Ensure that funds are distributed responsibly and not spent all at once.
Estate reduction: Lower the taxable value of your estate, while still helping loved ones now.

Each trust can be tailored to fit your family’s goals and financial picture, with explicit provisions for management, timing and oversight.

How a Gift Trust Works

When you create a gift trust, you name a trustee to oversee the assets. The trust document details how funds can be spent, at what ages distributions occur and for what purposes (such as education or home ownership). Many gift trusts are irrevocable, meaning the assets are permanently removed from your estate and reduce future estate taxes.

It’s also possible to structure trusts to take advantage of the annual gift tax exclusion, which allows you to gift up to a certain amount per beneficiary each year without incurring tax. Over time, this strategy can significantly shift wealth while preserving tax efficiency.

Balancing Control and Flexibility

Trusts can be highly flexible, with terms designed to reflect your values and priorities. Some trusts allow beneficiaries to receive funds in stages, while others include incentives for achieving educational or professional milestones. The key is striking the right balance — offering support while maintaining guidance.

Turn Generosity into a Lasting Legacy

Giving is a key part of shaping your family’s future. With the proper legal guidance, incorporating trusts into your gifting strategy will ensure those gifts are protected, purposeful and enduring. An experienced estate planning attorney can help you select the right trust structure, understand tax implications and ensure that your generosity continues to benefit your loved ones for generations. If you would like to learn more about gifting and estate planning, please visit our previous posts.

Reference: ElderLawAnswers “The Benefits of Giving Gifts to Your Grandchildren in Trust”

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Avoiding Probate Is Key to Protecting Your Legacy

November 25, 2025

Probate is the court process that validates a will, appoints an executor, gathers assets, pays creditors and authorizes distributions. It exists to protect heirs and creditors. However, it can add months of delay, court fees and public filings that many families would rather avoid. Avoiding probate is key to protecting your legacy. The good news is that a handful of simple tools can help most households sidestep the bulk of the process, while keeping their plan clear and coherent.

What Probate Actually Does

Probate converts a will into a court-ordered document. In some states, it is streamlined; in others, it can be slower and more expensive. Either way, it is public by default. Petitions, inventories and some accountings may be part of the court file. If privacy and speed matter to your family, it pays to minimize the amount that must pass through the court.

When Skipping Probate Makes Sense

Avoiding probate is most beneficial when beneficiaries require immediate access to funds for housing, tuition, or medical expenses, when family members reside in different states, or when there is real estate in multiple states that could result in multiple court cases. It also helps when you value privacy and want to minimize the disclosure of net worth and family relationships.

Simple Paths That Bypass Court

Life insurance, retirement plans and many bank and brokerage accounts can pay directly to named individuals or to a trust. Use both primary and contingent beneficiaries, so money has a clear path even if someone dies first.

Transfer on death and payable on death

TOD and POD tools allow many financial accounts, and, in some states, real estate, to pass with a recorded form instead of a court order. Confirm how your state handles deeds and what documentation the custodian or recorder requires at death.

Revocable living trust

A living trust holds assets during life and directs distribution afterward. If funded properly, it lets your trustee act without opening a probate estate. Trusts are especially useful for real estate, closely held business interests and accounts that benefit from centralized management.

Joint ownership

Joint tenancy with right of survivorship can move property to a co-owner at death. Use it sparingly. Adding a name for convenience can create gift issues, creditor exposure and family disputes if expectations are unclear.

Avoiding Conflicts Between Documents

Your will, trust and beneficiary forms must tell one coherent story. If the trust makes staggered distributions for a young or vulnerable beneficiary, do not name that person directly on the accounts. If the trust owns real estate, ensure that the deed is titled in the name of the trustee. Maintain a single asset map that lists each account, its current location, the account’s title and the named beneficiary.

Practical Steps to Avoid Probate Today

Collect and review all beneficiary forms. Add contingents and remove any “estate” beneficiaries that would force court involvement. Record TOD deeds where available and confirm titling on joint property.

Centralize documents, logins and contact information for custodians, so your executor and trustee can act quickly. Finally, add a short letter of instruction that explains what you want sold, what you want kept and how you want personal items handled.

How A Probate Lawyer Can Help

Avoiding probate is key to protecting your legacy. A probate lawyer can estimate the time and cost of court proceedings in your state, then design a bypass plan that utilizes designations, TOD or POD tools and a revocable trust where appropriate. Counsel can harmonize deeds, update forms and coordinate with custodians so paperwork is accepted the first time. If you want a faster and more private transition, schedule a consultation to map your assets, align your titles and forms and limit what must enter the courthouse. If you would like to learn more about probate, please visit our previous posts.

Reference: Forbes (May 24, 2024) “Why Skipping Probate Could Save Time And Money”

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Retirees Should Adjust Planning With Four Big Changes in Mind

November 20, 2025

Retirement planning is never static. Tax laws evolve, healthcare costs shift and investment conditions change sometimes dramatically. For retirees, these changes can affect everything from monthly income to estate strategies. Understanding recent adjustments in tax policy and retirement rules can help ensure that your plan remains stable and sustainable. Retirees should adjust planning with four big changes in mind.

Changing Tax Rules for Retirees

Tax planning remains one of the most potent tools for preserving retirement income. Recent federal adjustments have affected both Social Security taxation and retirement account withdrawals. For instance, higher-income retirees may see a greater portion of their Social Security benefits taxed, while inflation adjustments have shifted income brackets slightly upward.

These changes make tax diversification more critical than ever. Retirees who rely solely on traditional 401(k)s or IRAs, where withdrawals are taxed as income, could face higher overall taxes in retirement. Combining pre-tax, Roth and taxable investment accounts provides flexibility to manage income levels strategically each year.

Adjusting to Required Minimum Distribution Rules

One of the most significant changes in recent years involves Required Minimum Distributions (RMDs). The starting age for RMDs has risen to 73, giving retirees more time to grow assets tax deferred. However, waiting too long to begin withdrawals can result in larger future distributions and higher tax bills later in life.

Some retirees may benefit from partial Roth conversions in their early 60s, especially during lower-income years before Social Security or RMDs begin. Spreading conversions over several years can reduce future taxes and provide more control over income in later retirement.

The Ongoing Impact of Healthcare and Long-Term Care Costs

Healthcare remains one of the most significant expenses for retirees. Medicare premiums are expected to rise, and out-of-pocket costs for prescription drugs and long-term care continue to increase. Without planning, these expenses can quickly erode savings meant for other goals.

Health Savings Accounts (HSAs), when used properly, offer a tax-efficient way to prepare for medical costs. Funds grow tax-free and can be used for qualified expenses at any time, even in retirement. Retirees should also consider long-term care insurance or hybrid life insurance policies that include care benefits to reduce financial strain later.

Inflation and Market Volatility

Even modest inflation can significantly affect retirees who live on fixed incomes. While 2024 and 2025 have seen periods of stabilization, retirees should continue planning for long-term inflation by balancing income and growth investments.

Bond-heavy portfolios, while stable, may struggle to keep pace with inflation over the long term. Adding moderate exposure to dividend-paying stocks, real estate, or inflation-protected securities (TIPS) can provide resilience. Working with a financial advisor to review investment allocations annually ensures that risk levels remain appropriate.

Integrating Legal and Financial Planning

Estate planning and retirement planning are inseparable. Changes to tax law, account rules and estate exemptions can affect how assets transfer to heirs. Retirees should review beneficiary designations, update wills or trusts and ensure that powers of attorney and healthcare directives are current.

An estate planning attorney can help retirees adjust their planning with these four big changes in mind. They can align investment and withdrawal strategies with legacy goals. This integration ensures not only tax efficiency but also future protection for beneficiaries. If you would like to learn more about planning for retirement, please visit our previous posts.

Reference: Kiplinger (Aug. 10, 2025) “Retirees Should Watch These Four Key Tax Changes in 2025”

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Spousal Lifetime Access Trusts can Protect Your Partner

November 18, 2025

For couples with significant assets, planning for the future is necessary to ensure financial security for the surviving spouse while minimizing tax exposure. Spousal Lifetime Access Trusts can protect your partner when you are gone. Often called a SLAT, it offers an effective way to achieve both goals. Combining long-term protection with ongoing access to funds helps preserve family wealth while maintaining flexibility.

Understanding Spousal Lifetime Access Trusts

A Spousal Lifetime Access Trust is an irrevocable trust created by one spouse for the benefit of the other. The grantor transfers assets, such as investments, real estate, or business interests, into the trust, thereby removing them from their taxable estate. The non-grantor spouse can then receive income or distributions from the trust during their lifetime.

This arrangement provides a balance between tax efficiency and practical access. It allows couples to reduce the size of their taxable estate while keeping resources available should unexpected expenses or financial changes arise.

How SLATs Protect Wealth

One of the main advantages of an SLAT is its ability to shield assets from future estate taxes. With current federal exemption limits set at historically high levels, couples can transfer substantial wealth now and lock in those benefits before potential tax law changes reduce the threshold.

The trust also serves as a form of asset protection. Once transferred, the assets generally cannot be reached by the grantor’s or the beneficiary’s creditors. This makes SLATs appealing to business owners and high-net-worth families seeking long-term security.

In many cases, the trust can also distribute income to the beneficiary spouse, ensuring that the family continues to benefit from the assets even though they are no longer part of the grantor’s estate.

Key Structural Considerations

While powerful, SLATs require careful design. Because they are irrevocable, the grantor cannot reclaim the assets after transferring them. Couples must ensure that they retain sufficient liquidity and income outside the trust to maintain their standard of living.

If both spouses create SLATs for each other, the trusts must differ meaningfully to avoid triggering the “reciprocal trust doctrine.” This IRS rule can invalidate tax benefits if two trusts are too similar, effectively treating each spouse as if they never transferred the assets in the first place.

Working with an experienced estate planning attorney helps ensure that each trust is structured uniquely using different funding sources, timing, or distribution terms to comply with IRS standards.

When to Consider a SLAT

A Spousal Lifetime Access Trust is particularly beneficial for couples with taxable estates who want to take advantage of the current high federal estate tax exemptions, which are set to increase from $13.99 million per person to $15 million for 2026. It’s also ideal for individuals who wish to preserve family wealth without cutting off financial flexibility for their spouse.

In addition, SLATs can complement other estate planning tools, such as irrevocable life insurance trusts or charitable trusts. By layering strategies, couples can maximize protection and tailor distributions to meet both personal and philanthropic goals.

Balancing Flexibility and Finality

Because SLATs are permanent, they require both foresight and discipline. Once assets move into the trust, they are beyond the grantor’s reach. However, that finality is what gives them their power. The trust ensures that estate taxes, legal claims, or financial mismanagement will not erode assets.

Spousal Lifetime Access Trusts can protect your partner when you are gone. Couples who thoughtfully design SLATs often find peace of mind knowing that their partner will be cared for, no matter what happens. If you would like to learn more about SLATS, please visit our previous posts.

Reference: Forbes (Sep. 30, 2025) “Spousal Lifetime Access Trusts: A Strategic Estate Planning Tool”

Portability Doesn’t Happen Automatically

November 13, 2025

Portability allows a surviving spouse to use any “leftover” estate tax exclusion from the first spouse to die. It’s a powerful estate planning technique, according to a recent article in Think Advisor, “This Estate Tax Filing Mistake Can Cost Clients Millions.” However, portability doesn’t happen automatically.

To secure portability, the executor of the first deceased spouse’s estate must file a Form 706—known as an estate tax return—to elect portability, and it must be filed in a timely manner and be properly prepared.

This is necessary even if no estate tax is otherwise due from the deceased spouse’s estate. Given the high federal estate tax exemption, most affluent couples nearing the threshold don’t need to file the form. However, it’s still worth filling it out. Here’s why.

A husband who dies with $5 million in assets passes that along to his wife, who may have $10 million of her own. If she lives another 20 years and is invested in markets, her wealth upon her death could be very close to or over the maximum estate tax exemption for a single person. If she secures portability at the time of her husband’s death, she can use his remaining estate tax exemption amount and avoid significant estate tax when passing wealth onto her heirs.

Even if the first spouse to pass doesn’t come close to the federal estate tax threshold, it still makes sense to take the right steps to secure portability. A recent Tax Court case illustrates how this can go wrong if not done correctly. A successful midwestern business owner died, and the form wasn’t filled out correctly. The filing mistake cost heirs an additional $1.5 million in estate taxes from the surviving spouse’s estate.

The deadline to elect portability of a deceased spouse’s unused federal estate tax exemption is nine months after the date of death. While your estate planning attorney can request a six-month extension, it’s best to do this in a timely manner. If the estate isn’t otherwise required to file an estate tax return, you can use the Revenue Procedure 2022-32. This was added after many estates failed to file for portability because they didn’t realize it was needed until after the federal estate tax return was due.

This process is not easy and involves several important steps, especially if any of the first-to-die spouse’s assets flow to anyone other than the surviving spouse or a charity. In these situations, assets flowing out of the first estate must be assigned a fair market value using a valuation professional.

The IRS provides a valuation method for estates filing solely to capture portability. An executor may use a good-faith estimate of the value. However, securing a professional valuation may be recommended by your estate planning attorney.

The Tax Court case referred to above illustrates how this process can go wrong. The assets passed down by the first spouse to die went to other family members, not her spouse or a charity. A proper valuation was not done. The executor also applied for an automatic extension to file Form 706 but failed to mail the return until five months after the extended deadline. There are some instances when the IRS provides a “safe harbor” for late filing. However, this only applies when the value of the first deceased spouse’s estate is less than the applicable exclusion amount. The return was not complete, nor was it properly prepared.

Portability is a beneficial option and shouldn’t be missed, even when it seems unlikely to be needed. Just remember – portability doesn’t happen automatically. An experienced estate planning attorney should be consulted to protect the estate upon the death of the first spouse to secure portability. If you would like to learn more about portability and estate planning, please visit our previous posts.

Reference: Think Advisor (October 15, 2025) “This Estate Tax Filing Mistake Can Cost Clients Millions”

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A Cross-Border Strategy is Needed for Estate Planning with Assets Overseas

November 11, 2025

Ultra-high-net-worth families often live, invest and give across borders. A plan that works in one country can misfire in another. Different rules on domicile, tax residency, marital property and forced heirship can alter who inherits and how much tax is due. Institutions may also block access to accounts until local requirements are met. A cross-border strategy is needed for estate planning with assets overseas. It brings these moving parts into one coherent framework, so heirs receive what you intend with fewer delays and fewer surprises.

Where Plans Break Across Borders

Countries define domicile and tax residency in different ways. One country may view you as a resident based on days present, another based on ties such as a home or family. Several civil law jurisdictions enforce forced heirship, which reserves a portion of an estate for children or a spouse regardless of what your will says.

Community property and separate property systems divide marital wealth differently. Without alignment, the same asset can face competing claims or double taxation. Bank secrecy and data rules can also slow access, especially when fiduciaries lack translated and apostilled documents.

Building A Multi-Jurisdiction Framework

Begin by documenting where you are treated as tax resident and where you are domiciled. Keep residency certificates, visa records and professional analyses that explain treaty positions.

Next, identify succession rules that could override your choices. Some jurisdictions allow you to elect the law of your nationality or habitual residence to govern your estate. Make that election clearly in your will or trust if it is available and ensure that each country where you hold assets will honor it.

Align legal structures with asset locations. Company shares, private funds and real estate often benefit from situs-appropriate holding entities or trusts that are recognized locally.

Confirm whether the jurisdictions you care about recognize common law trusts, civil law foundations, or both. Where recognition is limited, consider alternatives such as shareholder agreements, life insurance wrappers, or local testamentary tools.

Coordinating Fiduciaries and Access

Execution details matter. Appoint executors and trustees who can act in each country or name local co-fiduciaries where required. Prepare notarized and apostilled copies of core documents and translations into the languages your institutions require.

Maintain a secure inventory of accounts, safekeeping locations and key relationships, along with device passcodes and instructions for two factor authentication. These access steps are as necessary as the legal documents, since many institutions will not release information without them.

Philanthropy, Art, And Liquidity

Cross-border philanthropy can trigger registration, reporting, or withholding. Decide whether to use a single foundation, parallel entities, or donor-advised funds in more than one country, for art, yachts, aircraft and collectibles, track situs, export and cultural property restrictions and insurance conditions.

Plan liquidity for taxes that may be due before private business interests or real estate can be sold. Consider credit facilities, life insurance, or staged distributions to avoid forced sales at a discount.

Using Multiple Wills Safely

Many families benefit from separate wills for different countries. Each will should cover only assets in its jurisdiction and should state that it is limited in scope so it does not revoke the other will. Coordinate signing formalities, witnesses and governing law choices. Keep originals and certified copies in a location where fiduciaries can easily access them.

How An Estate Planning Law Firm Can Help

An estate planning law firm with cross-border experience can map domiciles and residencies, make governing law choices where permitted and tailor trusts or entities that local courts and registries recognize. A cross-border strategy is needed for estate planning with assets overseas. If your life spans more than one country, schedule a consultation so a lawyer can align documents, structures and access protocols before a crisis forces hurried decisions. If you would like to learn more about estate planning for assets overseas, please visit our previous posts.

Reference: Forbes (September 24, 2025) “Cross-Border Estate Planning Guide, Essential Strategies For Ultra High-Net-Worth Families”

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Pour-Over Will is a Safety Net for Your Estate Plan

November 4, 2025

Many families use a living trust to avoid probate and maintain private distribution. In real life, assets are acquired, accounts are opened and paperwork is often overlooked. A pour-over will is a safety net for your estate plan. It directs anything left in your name at death to “pour over” into your trust, so your trustee can follow one set of instructions.

What a Pour-Over Will Does

It names your trust as the beneficiary of your probate estate. If you forget to retitle an account or receive an unexpected payment, the trustee will gather those items and route them to the trust. You get unified control of who inherits, when and how, because the trust’s terms apply to everything that pours over.

Benefits of a Pour-Over Will

Use it whenever you have a revocable living trust. It is helpful if you own property in multiple places, expect new accounts or inheritances, or want the trustee to manage holdbacks for minors, spendthrift protections, or staged distributions.

When Not to Use a Pour-Over Will

A pour-over will does not avoid probate for assets still titled in your name. Those items may still require a court process before they reach the trust. It does not replace beneficiary designations on life insurance or retirement accounts. It does not solve funding errors for out-of-state real property without additional planning.

How To Set Up a Pour-Over Will Correctly

Coordinate Documents

Your will must correctly identify your trust by name and date. Keep the trust and will stored together and update both after significant life events.

Fund the Trust During Life

Retitle key assets into the trust now, then use the pour-over will as a backstop. Add transfer-on-death or payable-on-death designations where appropriate, aligned with the trust plan.

Name the Right Fiduciaries

Choose an executor who can move promptly and a trustee who understands the trust’s instructions. Add alternates in case a first choice is unavailable.

Coordination With Beneficiaries and Taxes

A pour-over will is a safety net for your estate plan. Confirm that beneficiary designations on retirement plans and insurance align with the trust. If your trust includes tax planning or special needs provisions, verify that the pour-over will capture assets that must pass through those provisions. Keep a concise asset list with locations, so your executor and trustee can act promptly. If you would like to learn more about pour-over wills, please visit our previous posts.

Reference: NerdWallet (Sep. 16, 2025) “What Is a Pour-Over Will and How Does It Work?”

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Keep Certain Assets Out of a Trust to Avoid Probate

October 30, 2025

Living trusts are often praised as the cornerstone of avoiding probate. By transferring assets into a trust, individuals can ensure a smoother transition of wealth to heirs, often bypassing costly and time-consuming court proceedings. Yet, despite their benefits, not all property is well-suited for titling in a living trust. Including the wrong assets can create unintended tax consequences, legal complications, or unnecessary administrative burdens. It is wise to keep certain assets out of a living trust to avoid probate.

Understanding Living Trusts

A living trust is a legal entity that holds assets during a person’s lifetime and directs their distribution upon death. It provides flexibility, privacy, and efficiency compared to a will. However, it is not a one-size-fits-all solution. Certain assets are best kept outside of the trust to ensure they function as intended.

Retirement Accounts and Living Trusts

One of the most common mistakes in trust planning is transferring retirement accounts, such as IRAs, 401(k)s, or pensions, into a living trust. Federal tax rules treat these accounts differently, requiring that they remain in the individual’s name until withdrawal or distribution.

If a retirement account is retitled in the name of a trust, it could trigger immediate taxation of the full balance. Instead, individuals should use beneficiary designations to transfer these assets directly to their heirs, preserving tax advantages such as “stretch IRA” benefits where applicable.

Vehicles and Living Trusts

Cars, trucks, and other vehicles are generally poor candidates for trust ownership. The administrative burden of retitling, insurance complications, and the frequency of buying or selling make them impractical to place in a trust.

In most states, small estate provisions allow vehicles to pass outside of probate without issue. Unless a car is a valuable collector’s item or part of a business, keeping it in personal ownership usually makes more sense.

Health and Medical Savings Accounts

Like retirement accounts, Health Savings Accounts (HSAs) and Medical Savings Accounts (MSAs) have unique tax treatments that do not align with trust ownership. Instead, owners should assign beneficiaries directly through the account provider. Upon death, the funds transfer smoothly to the named beneficiary.

Assets with Named Beneficiaries

Life insurance policies, payable-on-death (POD) bank accounts, and transfer-on-death (TOD) securities accounts already bypass probate when a beneficiary is named. Including these assets in a trust is redundant and can even complicate matters. Ensuring that beneficiary designations are up to date often provides a more straightforward path.

Mortgaged Property

While real estate is often placed into a trust, property with outstanding mortgages requires careful planning and consideration. Transferring a home with a mortgage into a trust may trigger concerns or due-on-sale clauses from lenders. Proper legal guidance ensures compliance with both trust law and lending agreements.

When to Seek Guidance

It is wise to keep certain assets out of a living trust to avoid probate. Estate planning is a deeply personal process, and what works for one family may not be suitable for another. An estate planning attorney can help evaluate which assets should be placed in a trust and which should remain outside. They also ensure that excluded assets are transferred through other probate-avoidance methods, such as beneficiary designations or joint ownership structures.

If you are considering creating or updating a living trust, consulting with an estate planning attorney ensures your trust is both practical and efficient. If you would like to learn more about placing assets in a trust, please visit our previous posts.

Reference: Yahoo Finance (September 11, 2025) “If you want your kids bypass probate when you die, here are 5 assets to avoid putting in a living trust”

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Category: Assets