A new idea for people who set up long-term trusts is that of the “trust protector.” A trust protector is different from a trustee. A trustee’s job is to administer the trust on a day-to-day basis according to how it is written. A trust protector’s job is to “protect” the trust by making very occasional changes to its rules as needed to further its goals. The idea is to keep a long-term trust serving the purposes

Clarence Smith Sr., a Florida resident, decided he no longer wanted to have to manage his finances. He signed a power of attorney document authorizing his son to handle his affairs. Clarence owned a bank account jointly with a female friend from his retirement community. His son became suspicious about some withdrawals from the account and contacted the bank. He asked the bank to transfer $64,000 from the joint account into an account owned solely by

If you or an elderly relative is hiring someone to provide care in their home, you should be aware that the “nanny tax” may apply. Generally, the tax applies if you hire someone and pay them $1,700 or more a year. Here’s what’s involved: You must pay the employer’s share of Social Security and Medicare taxes for the employee. That’s 6.2% of wages for Social Security and 1.45% for Medicare.

Here’s something you probably never thought about: Just because someone leaves you money or other assets in a will, that doesn’t mean you have to take it. You can also just say, “No, thanks.” (Actually, you have to do more than that. You have to sign an official document called a “disclaimer.”) Why on earth would someone turn down a bequest? Well, it turns out that in some cases, doing so can save a family money

A health care proxy states who you want to make medical decisions for you if you’re not able to make them yourself. A living will provides a roadmap as to how you want those decisions to be made. It’s a very good idea to create these documents, and to review them on a regular basis. Here are some things to consider: Has your state recently adopted a “standard” health care proxy form? Some states have adopted

If you intend to leave your children equal shares of your estate, don’t forget to consider any money or property held jointly with a child. If you have recently added a child to a bank account, own property jointly with one of your children, or have set up a payable-on-death account with a child as the beneficiary, you might want to revise your will, or at least reconsider how the asset is titled. Here’s why: Property

Many people include charitable gifts in their will. Not only do they want to help certain charities, but doing so can reduce estate taxes. But suppose that at some point, it becomes clear that your estate will likely incur little or no estate tax. You might consider removing all or part of such a bequest from your will, and instead making a gift while you’re still alive. Doing so could give you a large income tax

With the federal estate tax now back in effect – and the possibility that it will apply to estates as small as $1 million at some point in the next few years – many people need to take a second look at their life insurance policies. Life insurance proceeds are not subject to income tax. But what many people don’t realize is that if you own your life insurance policy, then the proceeds will be considered

The federal estate tax is back in effect as of January 1, 2011. As a result of a last-minute compromise in Congress, the estate tax will be temporarily reduced for two years. In 2011 and 2012, the tax will apply to estates over $5 million, at a rate of 35%. However, unless Congress changes the law again, after 2012 the tax will apply to any estate over $1 million, at a rate of 55%. As a