Individuals who reside here in the Low Country who are in a position to leave a lasting legacy must develop a solid working relationship with a seasoned and savvy South Carolina estate planning attorney.
The fact of the matter is that things are always changing, and when you are in possession of significant financial resources you can be exposed to considerable damages if you go any length of time without making the appropriate adjustments.
What types of changes are we referring to here? For one thing, the parameters of the estate tax are always moving around. Back in 2009 the estate tax carried a 45% rate and a $3.5 million exclusion. It was repealed throughout 2010 due to provisions contained within the Bush era tax cuts. In 2011 the estate tax returned with a $5 million exclusion and a 35% maximum rate.
This year the exclusion went up to $5.12 million to account for inflation while the 35% top rate stayed in place. Next year we will see more changes that could potentially create the need for an estate plan update.
In 2013 the exclusion plummets to just $1 million and the rate rises to 55% under currently existing laws.
Imagine someone with say $5 million in resources being unaware of these changes. This individual goes forward in 2013 with no particular tax efficiency strategy. $4 million out of that $5 million is taxable at a rate of 55% if he or she happens to pass away during 2013.
There are also changes that take place within your own life that can render your existing estate plan obsolete such as marriage, divorce, and remarriage.
The takeaway here is this: Estate planning is a process, not a one-time event. If you view it as such and take the appropriate actions along the way you can always be certain that your assets are optimally positioned and that your true wishes will ultimately be carried out come what may.