It’s December 2020.

This holiday season will be very different for all of us, and especially difficult for those who have lost loved ones or will not be able to spend time with friends and family. As we head towards the end of the year and hope for more stable times, here are some ideas we hope you will find helpful.

Review Your Documents

Review your estate planning documents. Are the beneficiaries and people you named as your executors, trustees, power of attorney agents, health care proxies, and guardians for minor children, still appropriate? Note your changes, but do not make notations or marks on your original documents! If you do not have documents call our office and we can help you get started in the new year.

Are you someone else’s executor, trustee, guardian, power of attorney, and/or health care agent? Do you know where the documents are located or who to call in case of an emergency? If you no longer want to act as someone else’s agent or fiduciary let them know right away so they can update their documents.

Meetings

We can meet in person at our Nyack office (with masks, of course!), speak on the telephone, or meet virtually if you do not want to leave the comfort and safety of your home. Technology and temporary executive orders give us the tools to meet and sign documents virtually.

Good-bye “Stretch IRA”

The SECURE Act of 2020 made sweeping changes, reducing the time most beneficiaries have to withdraw inherited retirement accounts. Spouses can still roll over retirement assets and “stretch” the payments over their lifetimes, but with a few exceptions for the account owner’s minor children (who lose the stretch once they are adults), the disabled and chronically ill, all assets must be withdrawn—and all taxed as ordinary income—within 10 years. The rules are extremely complicated, but working with your accountant and financial advisors, we can help.

If a trust is named as the beneficiary of your retirement assets, please speak with your advisors immediately. The new rules could drastically reduce the amount of time your trustees have to withdraw the funds, thus increasing the amount of income tax due. A new strategy for your beneficiary designations may need to be implemented.

EVERYONE should check their beneficiary designations on retirement assets right away and speak with your accountant, financial advisor and/or attorney. The importance of this cannot be overstated.

Supplemental Needs Trusts/Special Needs Trusts

If you have a supplemental/special needs trust for a disabled beneficiary, the new retirement distribution rules could affect the ability to take advantage of the stretch rules. Please call us right away to schedule an appointment to review the trust as changes will likely be needed.

Tax changes ahead?

With a new administration in 2021, there are likely to be changes to the estate tax laws. If your estate is $3.5million or more, think about making gifts (after speaking with your accountant, financial advisor, and our office!) ahead of any changes in the law. We don’t have a crystal ball, but working as a team we can discuss gifting strategies to possibly save estate taxes and benefit your loved ones (as well as beloved charities).

Name a Health Care Proxy now; list your medical information

• We hope that the worst of the pandemic is behind us, but it is best to be prepared. A health care proxy names people you trust to make health care decisions for you in the event you are unable to communicate your wishes. Do you have one? Do you know where it is? Don’t rely on documents you signed when you were last in the hospital or at the doctor’s office. If you need to make changes (or start from scratch), please do it now.
• Make a complete list of your medical issues, health care providers, insurance, and medications. Share it with your health care agents or let them know where they can find it. Update the Emergency Contacts on your telephone. Talk to your primary and back-up decision-makers about your wishes. Make sure your documents are registered with Assuring Your Wishes (and make sure you and your agents know the username and password!).

Organization is key!

• Make a list of all your assets—bank accounts, investment accounts, real estate, retirement funds, insurance, copyrights, artwork, heirlooms, vehicles—everything! Note how assets are titled and the account numbers, websites, user names, passwords, and where the asset is located. This will be an enormous help to your loved ones and fiduciaries. Visit our website and download the appropriate questionnaire to help you organize your assets.
• What keeps your daily life going? Make a list of utilities, insurance, mortgages, rent, cable and internet providers, newspaper deliveries, cell phone contracts, service providers, credit cards, social media, email accounts, etc. Include contact information, account numbers, passwords. Make sure someone you trust knows where you keep this information so he/she can step in if you are out of commission.
• Check the beneficiary designations on your life insurance policies, annuities, retirement accounts, employment death benefits, bank accounts, etc. Beneficiary designations override language in your will or revocable trust. If someone inappropriate is listed (like an ex-spouse or a deceased person), fix it fast! If your beneficiary is a minor, speak with your financial advisor to name a custodian in case the beneficiary is still a minor at the time he/she inherits. If a beneficiary is disabled, please contact us right away so you do not inadvertently upset his/her access to benefits.
• If you never moved assets to your revocable living trust, now is the time to do it. Revocable living trusts proved their power this year when the courts were closed and probate estates were frozen while waiting for an executor to be appointed. Trustees, on the other hand, can settle estates almost seamlessly because they do not need court approval to proceed. Please go to our website at www.caneboniface.com to read our article about revocable living trusts. If you would like a printed copy, please call our office.
• Update the contact information for yourself, your beneficiaries, executors, health care decision-makers and anyone else who plays an important role in your plan. Please send us a copy for our files.

Share if you can

Many people are out of work or underemployed. A special $300 charitable deduction is available in 2020 even if you do not itemize. See if your employer will match your gift. Think about making larger contributions
directly from your retirement assets for tax savings (speak with your advisors first, as this option is not available to everyone). Declutter and donate items you no longer need or want. Give away gift cards that you will not use; many organizations can distribute them to those in need or use them to raise much needed funds.

Reach out

Many people will be forced to spend the holidays alone because of health concerns and travel restrictions. Even under normal circumstances the holidays can be difficult for many people, but this year will be especially hard.
Send out cards and call friends and family members or set up a virtual meeting. Your holiday wishes will cheer them up and likely will do the same for you.

Updated website

We are giving our website a face-lift! We expect to launch our new and improved site by January 1st. Please go to www.caneboniface.com, where you will find important and useful information, and check back in January
for even more information.

Holiday Wishes

We wish you and your loved ones a wonderful holiday season and hope the new year will bring good health and many happy moments. We will be closed from December 24th through January 1st to spend time with our families, but we will be checking messages and emails, so please do not hesitate to reach out to us.

Warmest regards,

Barbara H. Cane, Of Counsel 
Courtney E. Boniface
Stephanie Zacharias