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Illinois Estate Tax Exemption Increases in 2013
According to Lexology, the Illinois estate tax exemption increased in 2013. The differences between the Illinois estate tax system and the federal estate and gift tax regime require very specific estate planning for residents of Illinois, as well as anyone who owns real estate in Illinois.
According to Lexology, the major differences between the Illinois estate tax system and the federal estate and gift tax regime are:
- "The Illinois estate and generation-skipping tax exemption is $4 million, while the federal estate and generation-skipping tax exemption is $5.25 million.
- The Illinois estate tax exemption is not indexed for inflation. The federal estate tax exemption, however, is indexed for inflation and has increased about $250,000 since 2011 because of the inflation adjustment.
- Illinois does not impose a gift tax on transfers made during life, but there is a federal gift tax on transfers made during the lifetime.
What is Probate?
Probate is the process of figuring out how to distribute a person's assets after they die. If you have no estate plan at all, your property may not be distributed the way you wanted it to be distributed Taxes and state laws must be considered, but without a will, you have no control of your belongings. During probate, the court will oversee the division of assets and help mitigate any disputes. The process of probate starts with naming the executor, either by a will or, in the case that the deceased had no estate plan, someone named by the court. The executor presents the will, if there is one, to the probate court. Heirs, beneficiaries and creditors are notified that the estate is in court in case they want to contest a will or bring any claims. In the meantime, the executor manages all financial matters, including debts and bills. Once all debts are finalized in the court summary of receipts, a report is public and given to all the beneficiaries. How long the process of probate takes depends on how complicated the estate is. If a person is in a lot of debt, probate may take longer. Not all property is considered probate property.- Probate property is property that belonged to the individual who died, and had no other names on it.
Special Needs Trusts
Estate planning is very important for every adult in America, but especially so for parents of disabled children. If you are in this situation, you must first be sure that your child's needs are met throughout his or her life even after you are no longer able to care for him or her. You most likely also want to save some of your wealth for your children without special needs too though. In order to do this, you can create a "special needs trust." This trust will create public assistance to your disabled child.
Specials needs trusts supply money to the disabled child fir travel, recreation, education, medical expenses and rehabilitation, which are not covered by public assistance. The trust is written so that the person named as the trustee is only able to use the assets and money in the trust for benefits available for the disabled child. If, however, the trust funds are able to be used as prime means of support, the disabled child may not be eligible for forms of public assistance such as Medicaid.
Child Custody After Divorce
When you and your spouse go through a divorce, it also affects your children. As much as you may fight over them, the courts get to decide with whom your children will live and what the visitation arrangement will be. About.com offers this list of factors that the court considers when determining child custody:
- What the parents would like to do in terms of custody
- What the child would like to do
- The relationships and interactions that the child has with his or her parents, siblings and any other significant people in the child's life that may affect the best interest of the child
- The mental and physical health of all the people who are involved
- The child's home, school and community and his or her comfort
- Any physical violence that may have occurred or threat of physical violence by either parent who may become a custodian of the child, regardless of if it was towards the child or another person
The Types of Last Will and Testament Documents
A Last Will and Testament is designed to transfer assets upon death according to the wishes of the departed. This is accomplished by addressing the three concerns of the transfer, namely, beneficiaries of the will, guardians for any minors and an executor to administer the estate. This is accomplished in one of three separate ways.
The first type is a simple or statutory will which is primarily used in uncomplicated estate planning. There are state specific forms containing the necessary legal language which is completed by filling in the blanks. This "one size fits all" option is not recommended as each person's estate planning needs will be different.
The second type is a will with a testamentary trust. This is a form of estate planning when the testator, or will-writer, does not desire to create a revocable trust. This form of will is beneficial because it may avoid a guardianship estate if children are beneficiaries. Yet this form does not always allow the estate to miss probate and is just as complex as setting up a revocable trust.
Surprising Child Custody Statistcs
Many people automatically assume that because in the majority of divorces, the mother gets custody, that the courts must be biased in the women's favor. But statistical data by Pew Research Center reveals that may not always be the case.
According to the data, a married father spends 6.5 hours per week taking primary care of a child. A married mother spends 12.9 hours. This hold trues in two-income households, where both parents are working outside the home.
The statists on the time non-custodial parents spend with their children are disheartening. The statistics show that when fathers and children live apart, 22 percent of the fathers see their children more than once a week. Twenty nine percent of fathers see their children one to four times a month. And 27 percent of non-custodial fathers have no contact with their children at all.
More child custody statistics reveal that the majority of child custody cases are not decided by the courts. In 51 percent of the cases both parents agreed that the mother should be the custodial parent. In 29 percent of the cases the decision was made without any third party involvement. Only 11 percent of custody cases were decided during mediation with as few as 5 percent being decided after court order custody evaluations.
Marriage Not Thought to Have Health Benefits
One reason that people may stay in a bad marriage after they should be thinking about divorce is research that points to the idea that marriage makes people healthier. Conventional wisdom dictates that having a partner with whom to go through life makes people more likely to live longer and healthier, but a new study, according to U.S. News and World Report, points to the fact that the health benefits of marriage "seem to fade when you need them most." This could be a good argument for divorce over staying in an unhappy marriage.
Ohio State University researchers found that not only do married people often overestimate how healthy they are, a good marriage "provides less protection against death as health declines." The act of marriage is not equally protective for everyone, and as study lead author Hui Zheng told U.S. News and World Report, "for those who are already in poor health, marriage doesn't seem to provide any extra benefits." The findings we true for both men and women.
Identifying Your Assets
Estate planning may seem a daunting task, better left for the very rich or the savvy investor. An asset, however, can be anything—from a simple family home to an insurance policy—things that any average American may possess. Upon your death, what happens to your assets will be determined by the court if you don't make your wishes known beforehand. To do this, you'll first need to identify your assets and take stock of them. According to CNN Money Magazine, "these include your investments, retirement accounts, insurance policies, real estate, and any business interests."
Deciding where they will go upon your death is the next step. That is, you need to decide to whom you'll like your assets to go—only then can you begin to put framework in place to ensure that this happens. Your children? Your spouse? Begin by making a list of people you trust, and assigning them to various holdings. "Once you decide what kinds of bequests you wish to make, be sure to discuss your plans with your heirs," according to CNN Money Magazine. "The sooner and more distinctly you outline your intentions to your family and friends, the less chance there will be for disagreements when you're gone."
Getting over an Unfaithful Partner
Of the multiple grounds for divorce, an affair has the ability to hurt the most. It breaks down the trust and love that serves as the foundation of a marriage. It can also bring a lot of negative emotions to the forefront for the spouse that was cheated on. Anger, disbelief and sadness over this loss can be devastating to this spouse so it is important to understand the overall plan to rebuild after an infidelity.
Dr. Tammy Nelson has outlined three stages that must be reached for a relationship to be reestablished in her new book The New Monogamy: Redefining Your Relationship After Infidelity. The first phase is the crisis phase. The crisis comes to a head when the affair is exposed, but it is important to let the emotions pass before making a life altering decision. It might be hard because the person that you counted on in the past is now a mystery.
5 Ways for Retirees to Save Money
To keep the transition between having a secure, stable paycheck to living only on Social Security smooth, you must figure out how to make ends meet on your new fixed income. Here are five ideas to keep that transition smooth:
Get your social security right
Social security is a huge issue for all retirees, so be sure you make the most of it. Although there are many temptations to start taking your Social Security benefits early, if you postpone it, your monthly payments will be boosted when you do begin to take it. If you are married, consider the effects that your choice may have on your spouse as well
Invest for income and growth
With rates on banks CDs and bonds at low levels, retirees have had to stretch their money to get the income that they need recently, buying dividend stocks and high-yield bonds over safer income investments. Consumer stocks often yield more dividends than their bonds pay in interest. They also have long histories of dividend increases and share-price appreciation that could help your income grow and boost your retirement nest for later retirement years.
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