Adams & Edens, P.A. | Mississippi Probation Litigation Law Blog » Mississippi Estate Planning

Prenuptial Agreements – An Important Estate Planning Tool

admin — Thu, 08 Jul 2010 14:39:03 +0000

One of the estate planner’s most important planning tools is a prenuptial agreement. Prenuptial agreements are especially important for those who are entering into second marriages with children from a first marriage, or where one of the parties has a substantial estate prior to the marriage. Prenuptial agreements are often used in second marriages for the purpose of ensuring that the estate is preserved for children and others. Statistics show that second marriages have a high rate of divorce, so the use of an effective prenuptial agreement lessens the risks involved in entering into another committed relationship. Prenuptial agreements are also a valuable tool for ensuring family businesses stay in the family.

Important Tips for an effective prenuptial agreement:

1. For reasons that should be obvious, don’t wait until the day before the wedding to discuss the prenuptial agreement.
2. Discuss the prenuptial agreement with each other openly.
3. Discuss all of your assets with each other, as full disclosure is necessary for a valid prenuptial agreement.

Many people do not get prenuptial agreements because they believe it only increases the likelihood the marriage will fail, however, this is a cynical view of marriage. After all, marriage shouldn’t be about assets. For most of us, marriage is about love and commitment. If the only tie that binds is the thought of splitting assets, that’s not a commitment. Oftentimes, a prenuptial agreement is the only truly responsible way to enter into marriage.

Estate Tax Update

admin — Tue, 09 Mar 2010 14:59:33 +0000

For those of you out there wondering just what is going on with the estate tax right now, here’s a good article by Kathy Kristof with a synopsis of what’s happening with the tax and what you might expect in the future. With these fluctuations in the estate tax, now is the time to plan your estate. If you already have a will, visit an attorney and review it to make sure your estate is protected for 2011!

Estate Tax: Will They or Won’t They?

admin — Wed, 16 Dec 2009 15:32:18 +0000

Estate planners across the country are keeping an eye on Capitol Hill, where Congress is debating the future of the estate tax. The current estate tax exempts the first $3.5 million of assets from estate tax liability. In 2010 the estate tax will disappear completely, but if no action is taken the tax returns with a vengeance in 2011 at the much lower exemption rate of $1 million.

The current bet is that the 2009 rate with be extended at least for a year. Many in Congress would like to see the 2009 rate of $3.5 million per individual or $7 million per couple made permanent. A vocal group of Republicans would like to see the estate tax permanently repealed, but given their current minority status, that is unlikely. Here’s the latest from Bloomberg.com.

Th estate tax situation is obviously still developing, so stay tuned.

Ademption by Extinction

admin — Fri, 23 Oct 2009 22:04:16 +0000

A Will cannot bequeath property that the Testator does not possess. For example, if a Father decides to leave a house to his daughter by specific bequest in his Will, but then sells the house to someone else prior to his death, the bequest of the house to his daughter as contained in the Will is of no effect. This is what is known as Ademption by Extinction. See Welch v. Welch, 113 So. 197 (1927); Estate of Matthews, 791 So.2d 213, 218 (2001); Reddit v. Redditt, 820 So.2d 782 (Miss.Ct.App. 2002).

Ademption is a good reason to regularly review your Will and other estate planning documents, in order to ensure your plan will still be effective at your death. I usually recommend clients review their estate planning documents at least once a year.