California residents may be interested in some of the reasons that they should update their estate plan regularly. Due to changing circumstances, the provisions in a standing estate plan may become out of date over time.
Estate planning documents are something that should be revisited with an attorney from time to time. This is because the person may have had major changes to their finances or in their family situation, such as a marriage. In addition, laws that affect a person’s estate may have changed in the interim years. For instance, in April 2003, HIPAA healthcare privacy laws went into effect. If someone had created a power of attorney document before that date, their agent may not be able to conduct their business without specific language required by HIPAA in the document.
Many of the biggest changes that affect older estate planning documents have to do with taxes. Various new tax laws may make some estate planning obsolete or could lead to the person missing important tax planning strategies. One example is the 2005 addition of state-level estate tax laws. For those that are affected by these, they can have a big effect on their strategy to minimize estate tax liability. Similarly, increases in the estate tax exemption and the ability for a surviving spouse to use their deceased spouse’s leftover exemption have allowed for new strategies.
Keeping up with changes in the law and how they affect asset distribution strategies can be difficult without the help of an attorney. The attorney may be able to examine existing estate planning documents and update them according to the current laws.