The Most Important Aspects of Estate Planning in 2024

by | Feb 21, 2024

Approaching the estate planning process can be a daunting task. Even a simple situation can spiral into a complex situation quickly when confronted with all aspects of estate planning. Fortunately, Axis Law Group stands ready to assist with your estate planning goals! With estate planning attorneys located in the Colorado Springs and Denver areas, Axis Law Group can address the unique goals and needs of your estate.

One of the main questions that arises during the initial phases of estate planning is: “What do I need?” In certain circumstances, you may think only a simple will is needed, but in reality, a will on its own could leave your estate open to significant probate costs. In others, it can feel like drastic steps need to be taken to protect your assets, but there may be simple ways to organize your estate plan. To answer the question of “What do I need” in the year 2024, there are a few considerations to keep in mind.

Something is better than nothing

For many people, just starting the estate planning process can be the biggest hurdle to overcome. A simple internet search for Colorado estate attorneys can lead to hundreds of results, each with different areas of focus or expertise. Researching the benefits of wills and trusts can also become overwhelming, and what started as a productive first step can turn into hundreds of rabbit trails with no end in sight. This often leads to discouragement, and many people abandon their goals due to feeling overwhelmed.

Even if things start to feel discouraging, don’t give up! In estate planning, having something in place is almost guaranteed to be better than having nothing. This is why Axis Law Group offers free estate planning initial consultations with one of our estate planning attorneys. No matter what the result ends up being, we believe it’s vital for you to understand how to address your needs and goals while ensuring your estate is not subject to unnecessary costs and obligations. Whether that includes a family trust, a limited liability company for a business, or something else, our Colorado estate attorneys will explain your options and our recommendations so that you can keep moving forward.

Powers of Attorney

In Colorado, having powers of attorney for both financial and medical decisions represent a crucial part of any estate plan. If you become incapacitated and cannot make your own decisions, who would you trust to step in and make the decisions that are best for you? While many assume a spouse, family member, or close friend could step in to do this, that unfortunately is not the case.

  • For financial decisions, any assets that aren’t jointly owned cannot be accessed by another person. For example – if you have a savings account in your name only, your spouse would be unable to access that account absent a power of attorney appointing your spouse to make financial decisions. If that account needed to be accessed, a conservatorship hearing would be necessary to appoint someone to manage your finances. Even after spending significant money and preparation for this hearing, there is no guarantee that your spouse would be appointed as conservator. Courts oftentimes rely on professionals to act as conservator, which only adds more expense to the process. Appointing a financial power of attorney addresses all of these concerns in advance.
  • Medical decision making can lead to these same concerns, with some additional twists. While a guardianship hearing progresses in a similar way to a conservatorship hearing, Colorado also allows for a medical health care proxy to be appointed by your family, friends, and care team. This requires the people interested in your medical care to gather and come to an agreement on who should make medical decisions. While this may appear to be a good alternative to a court process such as guardianship, it can lead to its own issues. What if your loved ones disagree with your own feelings on medical decision making, and the person appointed makes decisions you disagree with? What if some of your loved ones feel differently than the majority, and relationships are damaged in the process? Additionally, a medical proxy cannot make end-of-life decisions related to life support. Creating a medical power of attorney with your estate plan cuts out the confusion and chaos that would otherwise occur.

At Axis Law Group, we include financial and medical powers of attorney when you create your estate plan. Along with other supportive documents, such as a HIPAA release and Advance Directive, you can protect yourself and your loved ones.

What about taxes?*

A common question while considering estate planning in Colorado relates to tax implications. “How can my estate avoid paying extra taxes?” is not only a good question, but an important one to ask.

Thankfully, Colorado is both a great place to live and a great place to die. This is because Colorado does impose any state-level estate or death tax. In other words, anyone who passes away in Colorado will not be forced to pay the state of Colorado any estate taxes.

However, the IRS may deal with your estate differently. A federal estate tax applies to some estates of a certain size. If a person passes away in the year 2024, and that person’s estate exceeds $13.61 million, a federal estate tax applies. For most people, it would take something significant (like winning the lottery) to reach that threshold. Even so, federal tax laws and rules change frequently, and the estate tax threshold is set to change after the year 2025. It’s important for your estate plan to reflect and adapt to the possibility of changes. At Axis Law Group, we work as a part of your team. In conjunction with your financial advisor and tax professional, we can make sure your estate does not encounter any unexpected consequences.

Contact us today!

Now that you know some of the important estate planning considerations in 2024, contact us today to schedule a free initial consultation with one of our knowledgeable Colorado estate planning attorneys!

 

*Tax advice disclaimer: Any tax advice in this writing is not intended or written by us to be used, and cannot be used, for the purpose of avoiding penalties that may be imposed by any governmental taxing authority or agency, or promoting, marketing, or recommending to another party any matters addressed herein. The content is not legal advice and is for informational purposes only, and you should consult with a tax professional related to any tax questions.