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Estate Planning Adjustments to Make When You Move to Another State

  • Dec 15, 2023

Each time we relocate, our list of things to do is inundated. Packing, hiring movers, and setting up new utilities come to mind. But there’s one crucial detail many overlook: revisiting our estate plans.

Moving between states is more than just a change of address; it can alter the very framework of your estate planning. Let’s dive into why this is crucial, especially if you or a loved one has special needs.

  1. Different State Laws Mean Different Estate Regulations

Each state has its own set of laws when it comes to estate planning. What works in one state might not necessarily be valid in another. For instance, New York State special needs trust requirements may be different from those in New Jersey. Not adjusting your estate plans can result in unforeseen consequences, including tax implications and the potential for invalidated documents.

  1. Taxation Variances

Different states have different tax structures. Some might levy an estate tax, while others might have inheritance taxes or neither. Moreover, the exemption levels and rates can vary significantly. For those with a special needs trust in New York, moving to New Jersey might mean reassessing the trust to ensure it’s optimized for the least tax implications.

  1. Special Needs Trust Considerations

Special needs trusts are intricate legal documents designed to benefit individuals with disabilities. They ensure the beneficiary can still qualify for public assistance while benefiting from the trust. Given the differences in state laws, a New York State special needs trust might not provide the same benefits or protections if you relocate to New Jersey. Engaging with New Jersey estate planning attorneys can ensure that the trust remains compliant and beneficial.

  1. Document Validity

Not all states will recognize estate planning documents executed in other states. While many will honor the intent of a legally executed document from another jurisdiction, this isn’t guaranteed. A durable power of attorney or health care proxy prepared under New York law might not be as effective when you move to NJ. Hence, having New Jersey special needs lawyers review your documents can be a wise move.

  1. Real Estate Considerations

If you own real estate in multiple states, it’s essential to understand how your estate plan addresses these properties. There might be a need to consider specific trusts or other tools to ensure smooth transitions and minimize potential tax consequences.

  1. Beneficiary Designations

Many people forget about the beneficiary designations they’ve listed on retirement accounts, life insurance policies, and other financial products. These designations override any instructions in a will or trust. Moving to a different state is a great time to review and ensure they align with your current wishes and the state’s regulations.

In addition to the above adjustments, it’s also important to consider the following factors when updating your estate plan:

  • State estate taxes. Some states have estate taxes, while others do not. If you move to a state with an estate tax, you may need to make adjustments to your estate plan to minimize your tax liability.
  • Community property laws. Community property states treat marital property differently than common law states. If you move to a community property state, you may need to update your estate plan to ensure that your assets are distributed according to your wishes.
  • Appointing a local executor or trustee. If you have named a friend or family member who lives in another state as your executor or trustee, you may want to consider appointing a local co-executor or co-trustee. This can help to ensure that your estate is administered efficiently and effectively.

Securing Your Legacy Across State Lines

The importance of updating your estate plan when moving across state lines cannot be overstated. The nuances of state laws, especially concerning special needs trusts and estate taxes, demand attention and expertise. The Falcon Law Group understands the intricacies of estate planning, particularly when it involves special needs law. Our team, comprising some of the most dedicated estate planning lawyers in NJ, is here to ensure that your estate plan is not just compliant, but optimized for your family’s needs.

If you or a loved one has special needs, or if you’re simply planning to move to another state, make it a priority to review your estate plan. Remember, the goal is to protect, provide, and ensure peace of mind.

Reach out to Falcon Law Group today and ensure that your move to a new state doesn’t compromise the security of your estate plan. Our New Jersey estate planning attorney team is here to guide you through every step.

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