What’s the #1 Estate Planning Tip for 2021?

For more than 50 years, The Foundation of the Greater Miami Jewish Federation has been a trusted philanthropic partner in the Jewish community, with a proven track record of working effectively with professional advisors and their clients. We are grateful to have the opportunity to work with so many talented advisors in Miami through our Professional Advisors Council, a network of over 200 estate planning professionals including attorneys, accountants, trust officers and insurance and financial advisors.

At our last Professional Advisors Council meeting, Susan Morrison, Chair, asked those in attendance to discuss the Number One Estate Planning or Financial Priorities for our donors in 2021. Here is what some of them shared with us:

“If you have recently moved from a high income-tax state to Florida, or are thinking about it, take steps to make sure that you have “socially distanced” from your “old” state for state income tax purposes. As higher income tax jurisdictions lose residents and tax dollars, it is increasingly important for clients to work with their accountant and legal advisors to make sure that they properly sever ties with the “old” state and establish domicile in the “new” state to minimize risk in the event of a domicile audit.”

Shaina Kamen, Senior Counsel
Holland & Night

“Organization is key; we all have so many accounts and products across multiple platforms and advisors. Being able to see everything on one page and identify overlap, gaps and inefficiencies is key to an optimal plan.”

Zachary Mann, Managing Director
Coastal Wealth, a member of the MassMutual Financial Group

“Given that we do not have certainty regarding (President) Biden’s potential tax plan, the number one estate and financial planning priority at this point would be to thoroughly review your estate planning strategy to ensure that everything is in order. President Biden has expressed an intention to decrease an individual's federal estate tax exemption amount either to $5 million per individual (and $10 million for a married couple), perhaps indexed for inflation and perhaps not, or to the pre-Tax Cuts and Jobs Act amount of $3.5 million per individual (and $7 million for a married couple). This decrease in lifetime exemption could be coupled with an increased top tax rate of 45 percent. Many high-net-worth individuals should contemplate additional planning in 2021 to use more or all of their remaining estate, gift and GST tax exemptions before a potential reduction in those exemption amounts (currently $11.7 million under each tax regime). However, one should proceed with caution because of the possibility that any changes to these tax regimes may be retroactive to January 1, 2021. More likely, any change in law that is passed in 2021 would be effective on a forthcoming date, such as January 1, 2022. That said, due to the uncertainty of what laws might change and when they would take effect, individuals contemplating additional 2021 estate and gift planning should contact an experienced estate planning professional to navigate the various issues and to take action sooner rather than later to get a planning strategy in place.”

Susan Morrison, CPA
Partner, BDO

“Priority number one should be to find an advisor with whom you can build a long-lasting relationship and one who not only has the basic licenses, but also the knowledge, credentials and experience to ask good questions, to listen and to understand first what’s important to you — whether it’s your family, your business, charitable organizations or otherwise — and then offer potential solutions. After all, everyone has unique circumstances. Otherwise, it’s like walking into a medical office and the physician prescribes you medication before even asking about your health concerns.”

Robert Newman, ChFC, Managing Partner
National Planning Corporation

“Stay invested in equities for better year-end results. Stay tuned for opportunities for further income tax planning, as risk assets seem to be the only option based on current market conditions. At appropriate times, donate either low-cost basis stock or cash as income tax rates appear to rise.”

Sandra Reif, Senior Vice President and Senior Investment Strategist
Wells Fargo Private Bank

“Making sure that your estate plan is up to date with all of the recent changes to laws and checking to see if any proposed changes to the laws over the next few years will affect you or your estate plan”

Michael P. Schwartz, Esq.
Muller Lebensburger & Schwartz

“Confirm beneficiary designations, such as your life insurance policy, brokerage account and retirement plan”

Joy Spill
Joy B. Spill, P.A.

“With a new administration coming into office and proposing a significant reduction of the federal gift and estate tax exemptions, consider gifting assets to or in trust for family members to lock-in the larger exemptions under current law.”

Elan Sternberg, Manager, Forensic, Advisory & Valuation Services
Kaufman Rossin

“A periodic review of your life insurance policies is always a good idea — and may indicate a need for sensible, timely updates. In addition to confirming beneficiary and ownership arrangements, it’s important to:
1. Confirm coverage amount is sufficient to meet survivor’s needs and current priorities
2. Be aware of remaining term insurance duration before premiums skyrocket or policy terminates
3. Obtain in force reports to confirm (permanent) policy performance and avoid premature lapse”

Andrew H. Wolf
Independent Insurance Consultation and Evaluation

For more information about our Professional Advisors Council or how to get involved, please contact Adam Kaplan, Commerce and Professions Director at [email protected] or 786.866.8414.