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Bloomfield Office
Three Regency Drive
Bloomfield, CT 06002
Phone: (860) 242-2221
Fax: (860) 286-0185New Haven Office
1164 Townsend Avenue
2nd Floor
New Haven, CT 06512
Phone: (203) 468-4770
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Annual Estate Plan Update 02-03-2010 This time of year – after the holidays and preparing to file income tax returns – is a good time to review your estate plan. This year, more than in the past, a thorough review of your estate planning documents is necessary for a number of reasons. First, the 2001 Tax Act which increased the exempt amount for the Federal Estate Tax, has expired. Although Congress has said that it intends to remedy this situation, at this time there is no federal estate tax. However, this “good news” may be short lived as the federal estate tax is scheduled to come back into existence on January 1, 2011. Second, on the State level, the exempt amount has increased to $3.5 million. However, the General Assembly has attempted to delay implementation of this law for a couple of years due to the budget deficit. While Governor Rell vetoed the latest attempt, no one knows what the final outcome will be. Many married couples set up their estate plans using formulas tied to the federal estate tax in order to avoid or minimize estate taxes. The fact that there is no federal estate tax at this time could result in a spouse being disinherited. In addition, the fact that there is a Connecticut Estate Tax, your present estate plan could result in taxes being owed on the death of the first spouse. Both of these are good reasons to review your estate planning documents now. Of course, if you don’t have a Will, the State of Connecticut has provided for you. The laws of intestacy state what will happen to your assets upon your death if you die without a Will. Some things can only be provided in a Will: - educational needs for children or grandchildren.- support for favorite charity - appoint executor - appoint guardian for minor children - taxes Your estate plan consists of more than your Will. You should also deal with issues concerning your personal autonomy which may arise while you are alive. Specifically I am referring to a durable power of attorney and advance directives. In the last few years the laws concerning these documents have been amended. The durable power of attorney can no longer be used to make medical decisions for the principal. It is now basically a financial instrument allowing the attorney-in-fact to make financial decisions on behalf of the principal. The so-called “living will” statute has been broadened. The document is now referred to as Advance Directives. It includes the appointment of a health care representative. This person is allowed to make health care decisions which are not “end of life” decisions, if the doctor determines the principal is incapable of making such decisions. It also contains “end of life” treatment language (“living will”) as well as the designation of a conservator and language concerning the making of an anatomical gift. Of course you should take an inventory of your assets. Not just what you own, but how are the assets titled: - solely owned assets - jointly owned assets - assets with designated beneficiaries Recent articles in both the Hartford Courant and the Wall Street Journal have stressed the importance of reviewing your estate plan in view of the changing laws. If you would like help in reviewing or preparing your estate plan, please contact Francis J. Farrelly (860) 242-2221 or ffarrelly@ctattys.com. For more information, please contact Attorney Francis J. Farrelly.
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