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2021 – Why You Should Plan for Your Estate This Year

17 March 2021

Today, we are talking estate planning. When your labors have borne abundant fruit, it’s natural to want to hold on to it as long as you can. It’s equally natural to want to provide for your family.

The two impulses, sometimes in conflict, can lead to a reluctance to take the steps to plan ahead. I’ve seen families with a great deal of money find themselves in chaos when a family head dies suddenly, without having done any estate planning.

One good reason to devise and implement an estate plan is so that your family won’t have to deal with a tangle of money matters while they process their enormous grief.

But there are, in 2021, many good reasons to develop your estate plan and put it in place without delay.

For 2021, the estate tax exemption is $11.7 million per person. For married couples, this means you can shelter $23.4 million from estate taxes jointly. At least on paper, you have through 2025 to implement an estate plan, with this large exemption (rising for inflation). Under current statute, for 2026 the exemption is set to revert to $5.49 million per person, representing its prior level of $5 million as adjusted for inflation.

However, on the campaign trail, President Joe Biden expressed a desire to return the estate exemption to $3.5 million per person, and it’s possible he could get this passed through Congress in 2021.

Some states, too, currently suffering declines in revenue due to COVID-19 issues such as business closures and lockdowns, among other things, are considering lowering their own estate tax exemptions where estate taxes are already in place or instituting estate taxes where none currently exist. Washington D.C. has already reduced its estate tax exemption for 2021, from $5.67 million in 2020 to $4 million in 2021 – a significant decline.

When you have assets worth protecting, it’s in your and your family’s best interest to start estate planning now.

Gifting now will remove not only the value of the gifted assets from your estate, but all the appreciation on those assets between the date of your gift and your passing.

There are also other ways of sheltering assets – through vehicles such as family trusts, charitable trusts, and many others.

Given the potential significant changes to the estate exceptions, you should not waste time reviewing your estate plan and documents with both your CPA and your attorney.

And if you don’t already have an estate plan, please consider getting one devised for yourself, and implementing it.

None of us knows what tomorrow will bring, so plan today.

If you have questions on estate planning, and how to best protect your family, your assets, and your legacy, please click here to email me directly – I am here to help.

Until next Wednesday –



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