Stock Market Analysis and Personal Finance

Mr. Bernstein

Estate Planning and Taxes, pp 499-513

June 12, 2015

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Stock Market Analysis & Personal Finance Mr. Bernstein

Estate PlanningDefinition of an Estate: All property and assets owned

by an individual or groupEstate includes money, securities, real estate,

business interests, receivables, and intellectual property (including social media information)

Estate Planning is therefore the process of a detailed plan to distribute those assets to beneficiaries of your choice upon your death, and to minimize taxes

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Stock Market Analysis & Personal Finance Mr. Bernstein

Types of WillsSimple Will leaves everything to a spouseOther Wills may divide assets between spouses,

children, family, friends or charities. State law may mandate a minimum for spouses

Typically expressed in percentages, not dollars – why?Often specifies specific assets to specific beneficiariesShould be updated with every major life change

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Stock Market Analysis & Personal Finance Mr. Bernstein

Will BasicsAn Executor is selected to carry out the tasks in the

will; alternates or contingents are named alsoProbate Courts validate wills and insures debts are paidLiving Trusts avoid expensive and lengthy probate

process and reduces taxesAssets are transferred to a trustee, along with

instructions on who receives benefits during your lifetime as well as upon your death

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Stock Market Analysis & Personal Finance Mr. Bernstein

Executor ResponsibilitiesTake inventory of belongingsAppraise and distribute assetsPay TaxesSettle DebtsLegally Obligated to Act in the Interests of the

Deceased, as directed by the WillYou must file a legal document if named but unable

or unwilling to serve as Executor

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Stock Market Analysis & Personal Finance Mr. Bernstein

Taxes and Estate PlanningEstate Taxes are as high as 40% (Federal) and 16% (NJ)Current Federal exemption is the first $5.25mm but

current New Jersey exemption is only $675,000Insurance policies can be used to insure cash available

to pay estate taxes without selling assets