What is an estate?
Each of us has several different “estates” for estate planning purposes. The first is your “taxable estate,” which consists of the assets to which an estate tax will be applied at your death. This “estate” includes all the things that you own or over which you have control at the time of your death. Your “taxable estate” will include all of your clothing, furniture, jewelry, collectibles, antiques, bank accounts, investments, real estate, retirement accounts, life insurance policies – in short, everything. If there is any question in your mind regarding whether or not something will be includable in your taxable estate, it is safe to resolve your doubt in favor of inclusion. Since the estate tax is a tax on the transfer of assets, the value of the assets owned by the decedent is the amount that is subject to the tax. That is why a life insurance policy is includable at its death benefit value, not on its cash or surrender value. The other kind of estate is your “probate estate.” Your p
An “estate” consists of the property owned or controlled by a person, including debts. A persons estate consists of all of his or her property and possessions, including bank accounts, real estate, furniture, automobiles, stocks, bonds, life insurance policies, pensions and death benefits. Every adult person has an estate because they have some property, regardless of its market value.
Your estate consists of everything you own or over which you control the distribution. In my office, we prefer to use the formal names for some things. The formal legal term for your estate is your “stuff.” But it also may be your family and those to whom you want to see benefit from your stuff or your wisdom and experience. A lot of people think, “I don’t need an estate plan because I don’t have much.” This thinking is seriously flawed. Most people have more than they realize. If you own a tarpaper shack and an Edsel, you have enough in assets to do estate planning. It assumes planning is only for those with a lot of assets. Estate planning is a lot more about planning for the people we love than for the assets we have. It overlooks the “non-material” aspects of planning. If you have a family or loved ones you care about, you should have an estate plan. The term “estate” consists of all the property a person owns or controls, whether in his or her sole name, held in a partnership, in
There is a common misconception that “estates” are exclusive to multi-millionaires. A residence, no matter how large or small, is part of an estate. An estate is, quite frankly, everything a person owns in his or her own name or owns with another person, everything payable to his or her estate, and everything controlled by that person. Your estate can comprise your residence, cash, stocks, bonds, and other investments, as well as businesses that you own. Your estate also comprises of retirements plans, such as IRAs and Keogh’s, and life insurance death benefits. It even includes personal property, such as vehicles, collectibles, and other treasured items.
Your estate consists of all property or interests in property that you own. The simplest examples are those assets that are in your name alone such as bank accounts, stocks, bonds, furniture, furnishings, jewelry or real estate. You may also co-own real estate with someone else in forms called Joint Tenancy or Community Property. Assets that have beneficiary designations, such as life insurance, IRAs, qualified retirement plans and some annuities are very important parts of your estate and require careful coordination with your other assets in developing your estate plan.
