Somerset County retirement planning attorneys are always going to emphasize the importance of working within a framework that leads to a comfortable future. The financial decisions that you make along the way are going to have a lot to do with your ultimate destination.

If you go forward without sticking to any type of plan you may find yourself unable to retire at all, and this is certainly an unpleasant prospect for most people.

Contributing into the 401(k) plan at your place of employment is going to be part of the plan. If your employer offers to match your contributions all the better. It is advisable to contribute at least as much as the employer is willing to match to take full advantage of this opportunity.

It may not be the most pleasant prospect to consider, but if you were to lose your job you would have to make decisions with regard to what you would like to do with your 401(k). One option would be to do nothing and keep the 401(k), though there could be added costs involved and you may find it to be difficult to service the account.

If you choose to do so you could cash it out, but if you are under 59 1/2 you would have to pay a 20% tax and a 10% penalty.

The third option would be to roll it over into an individual retirement account or the 401(k) plan that is offered by your new employer if you were to get a job that offered such a plan in a timely manner.

Being ready, willing, and able to adapt to changing circumstances is part of the formula for success. The best way of revising your plan in light of things like a job change would be to sit down and discuss the proper course of action with a licensed and experienced central New Jersey retirement planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

There are large numbers of people in the United States who may be subject to the estate tax in 2013 unless they take action to mitigate their exposure. Under current laws the estate tax rate is going to go up from the 35% that is in place right now to 55%, and the exclusion is going to be reduced from $5.12 million to just $1 million.

The problem with taking action in light of these changes is that they may or may not actually take place. Yes, if things remain as they are right now and there are no legislative changes passed before 2013 the above scenario will hold sway. But a similar situation existed back in 2010.

During that year the estate tax was repealed due to provisions contained within the Bush tax cuts. That tax relief act was scheduled to expire at the end of 2010 and if it would have done so without any new legislation passing the maximum rate in 2011 would have been 55% and the exclusion would have been $1 million.

In the middle of December of that year a deal was struck in Congress that gave us a $5 million exclusion and a 35% top rate in 2011 with an increase in the exclusion to account for inflation up to $5.12 million in 2012.

So, it is possible that we could see new legislation that changes the estate tax parameters between now and 2013 like we did back in 2010. But of course there are no guarantees.

This is an interesting situation and it should be watched closely as the year progresses. If you have not yet discussed the matter with an expert, it would certainly be a good idea to take action and consult with an experienced Central New Jersey estate planning lawyer at some point during this year.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Financial success is supposed to be a purely positive thing that we are all encouraged to strive for throughout our lives. But the fact is that you have to pay the price for your success in the form of some rather harsh Federal taxes.

This is one of the first things to keep in mind if you should find yourself in possession of a significant amount of money, and it certainly crossed the minds of Facebook founders Mark Zuckerberg and Dustin Moskovitz.

According to Forbes magazine the Facebook founders planned ahead wisely and placed a significant amount of their Facebook shares into grantor retained annuity trusts a few years ago knowing that the shares would skyrocket in value eventually when an IPO took place.

The strategy that they utilized is called “zeroing out” a GRAT. When you place resources into the trust you are removing them from your estate for estate tax purposes. However, from the perspective of the IRS you are engaging in an act of taxable gift giving because you name a beneficiary who would inherit any remainder that may exist after the term expires.

The IRS assesses the taxable value of the gift by adding anticipated interest to the principal that you placed into the trust. They use 120% of the federal midterm rate that is in place at the time of the trust’s creation.

You zero out the trust, taking annuity payments equal to the entirety of the taxable value. But if the assets that you used to fund the trust appreciate beyond the rate that the IRS imposed, there will be something left. The beneficiary inherits this free of taxation.

If you would like to explore the possibility of creating one of these trusts, the first step is to sit down and discuss the matter with a licensed, experienced Central New Jersey financial planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Sometimes you are the victim of an accident, and when you look back on it you see how easy it would have been to prevent it. Once you have experienced the consequences you see things in a different light, but it is possible to avoid the difficult “learning through experience” pattern if you are proactive about awareness and prevention.

With this in mind you would do well to understand just how common it is for senior citizens to become injured in falls. According to statistics provided by the American Council On Aging, one out of every three senior citizens suffers from a fall at some point in time and the sad fact is that the results are often more catastrophic than you may think.

An older adult passes away due to injuries suffered in a fall every 29 minutes and falls are the leading cause of fatal injuries among our nation’s elders. Some 2.3 million patients are treated in emergency rooms for injuries sustained during falls each year at an estimated cost of nearly $30 billion.

Making sure that you are prepared for the eventualities of aging from a financial perspective with the assistance of a good central New Jersey elder law attorney is part of a holistic plan for aging. In addition, you must be aware of potential health challenges that exist and do everything possible to keep yourself healthy.

If you would like to learn more about falls and how to prevent them, simply visit the Fall Prevention page on the National Council On Aging website.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

There was once a time when $1 million was an amount of money that made you truly wealthy. However, at this point in time this figure does not hold the same magical quality that it once did.

The fact is that you could easily have a net worth exceeding $1 million without considering yourself to be extraordinarily wealthy and if you do have over $1 million in financial resources you have to concern yourself with the federal estate tax.

As of this writing the unified estate/gift tax exclusion is $5.12 million. This may leave you thinking that you have nothing to worry about because your estate is worth less than this amount. However, this figure is not etched in granite. In 2013 the estate tax exclusion will be trimmed down to just $1 million under current laws, and the rate of the tax will go up to 55% from the 35% that is presently in place.

According to CNN Money, there are approximately 10.5 million households in the United States that are in possession of at least $1 million in total assets. And, this figure is expected to double over the next eight years. So we are talking about millions of people being exposed to the federal death tax.

You may hear it said that the estate tax is only imposed on the wealthy, but there is a far cry between someone with $2 million or $3 million in total assets and an individual like Bill Gates or Warren Buffett. The suggestion here is to avoid potentially costly misconceptions and obtain your information from a licensed, experienced Somerset County NJ estate planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

When you give someone a gift you are aware of the fact that you are giving away something that has value and it costs you something to engage in this act of generosity. This is the essence of gift giving, a selfless act of divesting yourself of something that you own for the benefit of someone that you care about.

The above is all good, but what you may not bargain for is the tax man taking advantage of this opportunity as well.

If you give gifts that exceed a certain amount they are subject to the federal gift tax. The gift tax exemption is unified with the estate tax exclusion. Right now this unified exclusion is $5.12 million, but it is scheduled to be reduced to just $1 million at the beginning of 2013.

So if you were to give gifts totaling $1 million next year, your entire estate and any future gifts that you give while you are still alive would be subject to a tax. This levy will be carrying a 55% rate in 2013 unless changes to existing laws are made between now and then.

The above is not good news, but there are some gift tax exemptions that can be utilized that are separate from the unified lifetime gift/estate tax exclusion. One of them allows you to give as much as $13,000 to an unlimited number of people every year free of the gift tax. You can also pay the medical expenses and school tuition of others as a gift free of the gift tax.

Given the intricacies of the tax code expert advice is needed when you are planning your estate. To obtain the professional guidance that you need to optimally position your assets take action right now to arrange for a consultation with a good Somerset County estate planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

One of the many reasons why it is advisable to work with a good Central New Jersey estate planning lawyer when you are planning for the future is because of the fact that there are things to consider beyond the distribution of financial assets.

There are various contingencies that you may face at some point in time while you’re still alive, and one of these is the possibility of falling ill and becoming unable to communicate.

For this reason it is important to state your wishes about medical procedures and other matters such as organ donation. With a living will you express your preferences regarding how you feel about being kept alive indefinitely via the use of life-support measures should there be no hope of your recovery. You can also make your willingness to be an organ donor known.

A lot of people would prefer to let nature take its course, but if you do not make your wishes known this decision would fall into the hands of your family members. They can sometimes disagree and this is one concern. And even if they don’t, a decision of this magnitude is something that should not be placed in the lap of someone else.

The matter of organ donation is a serious one. According to OrganDonor.gov, 18 people die every day while waiting for a donated organ. The need is quite real and you could potentially do a lot of good if you express your desire to donate organs in your living will.

You can also register as an organ donor when you renew your drivers license, or you can sign up for the New Jersey organ donor registry online.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Depending on your unique situation, various different approaches may be necessary when you are planning your estate. There can be a lot more to it than simply drawing up a last Will. This is one of the reasons why you would do well to steer clear of do-it-yourself estate planning software and generic template last will documents.

Certain scenarios can call for some advanced estate planning techniques, and sometimes they are implemented in an effort to gain estate tax efficiency. The Federal estate tax sits poised to consume 35% of the taxable value of your estate as of this writing and this figure is scheduled to rise to 55% at the end of the year.

There are also New Jersey state death taxes to consider. So depending on the extent of your resources and the various forms they may be in some advanced strategies may be employed in an effort to gain estate tax efficiency.

Another type of situation that sometimes arises involves an heir who may have special needs. Individuals who have special needs may be receiving benefits from the government that are valuable to them. It can take some specialized planning to provide for a loved one with special needs while not doing anything to jeopardize his or her benefits.

It is important to recognize the fact that any number of legal instruments may be necessary to optimally prepare your assets for eventual distribution to your loved ones. This can only be accomplished with the assistance of a licensed, experienced and savvy Central New Jersey estate planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

On the one hand it is important to analyze the form that your assets are in as you are inventorying them in preparation for eventual distribution to your heirs after your death. There are various different ways to transfer assets and the best way will vary depending on the nature of the resources in question and any exposure to the estate tax that you may have.

With the above having been stated, the transfer is a two-way street. You as the giver have to prepare the assets optimally, but you also have to consider the tendencies of the recipients.

You plan your estate in an effort to provide for those that you love after you pass away. You won’t be around for them to turn to if they need assistance and this is going to be your final act of giving. This can be a source of concern if you have a family member who is not a good money manager.

One possible way to provide for such an individual would be to make this person the beneficiary of a spendthrift trust. These trusts protect the assets from creditors and claimants which is part of the appeal.

The assets in the trust are safe from bad decision-making because the beneficiary does not control the resources. The assets are handled by a trustee who will make distributions to the beneficiary in accordance with your wishes.

A spendthrift trust can provide you with peace of mind if you have concerns about one of your heirs. If you are interested in the possibility of creating one, simply pick up the phone to arrange for a consultation with a good Somerset County estate planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Somerset County estate planning lawyers are adamant about emphasizing how important it is for people of all ages to execute the appropriate estate planning documents.

Far too many people go through life under the impression that they are too young to have to worry about estate planning. But in reality, it is never too soon to start taking steps to provide for your family in the event of your death. After all, there are no guarantees and you do not know what the future holds.

This fact was demonstrated by the recent death of the singer Whitney Houston. Houston was just 48 years old when she passed away and it is not yet known precisely how she planned her estate. Observers suggest that her vast resources will be inherited by her 18-year-old daughter Bobbi.

Though Whitney Houston had a lot of financial success throughout her life, experts say that the value of her estate will increase dramatically as a renewed interest in her work takes hold.

Few of us expect pass away before we celebrate our 50th birthdays, but as you can see it does happen and it can happen to people who have everything to live for.

If you are currently unprepared for all eventualities action is required. The logical first step is to reach out and contact a good central New Jersey estate planning lawyer. He or she will answer all of your questions, evaluate your unique situation, and assist you as you execute the appropriate estate planning documents for the well-being of those that you love.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.