Read more about the article Not Everyone is Happy in Margaritaville as Estate Battle Brews
Heirs arguing over inheritance issues

Not Everyone is Happy in Margaritaville as Estate Battle Brews

Last week, Jimmy Buffett’s widow, Jane Buffett, filed a petition in a Los Angeles court to remove the co-trustee from a marital trust created for her benefit. She alleges that the co-trustee was openly hostile, adversarial, and refused to give her details on the trust, according to CNBC in the article “Battle over Jimmy Buffett’s $275 million estate highlights risk of family trusts.”

The co-trustee, Richard Mozenter, has filed a lawsuit of his own in Palm Beach County. He alleges that Jane Buffett has been uncooperative in his efforts to manage the trust, interfered with business decisions, refused to meet with him, and breached her own fiduciary duties.

While Jimmy Buffett’s brand is all fun and sun, he was no stranger to estate planning. His last will and testament was first written more than 30 years ago, amended in 2017, and again in 2023. It directed most of his assets to be placed in a marital trust for Jane, with the remainder beneficiaries being the couple’s three children. This means they will receive any remaining assets from the trust after their mother’s death.

Buffett also named a co-trustee to manage the trust, appointing Mozenter, who had been his business manager and financial advisor for three decades.

The Buffett estate is considerable. He was a very successful entrepreneur, building an empire and merchandising business exceeding the value of his song catalog. The court documents state that assets in the estate include $34.5 million in real property, $15 million in a company that owns his many airplanes and $12 million in investments. One of his largest assets is his share in Margaritaville, the popular chain of bars, restaurants, hotels and merchandise, estimated to be worth $85 million.

The relationship between the two co-trustees went south after Jimmy Buffett’s death. Jane says her co-trustee refused to provide her with basic information, set enormous fees to manage the trust, and, after a delay, told her she’d be receiving $2 million a year after Margaritaville had paid distributions of $14 million over the previous 18 months.

Appointing a co-trustee is considered standard practice. However, tensions between the beneficiary and the co-trustee may rise to litigation.

The first lesson: communicating estate planning decisions to beneficiaries and those in key roles should occur in advance. If Buffett had explained the co-trustee roles to Jane and Mozenter, clarified what would occur after his death, and set expectations, they might have done better together after his passing.

The second lesson: when trusts are established with co-trustees, a provision permitting a removal right is a wise move. This would have allowed Jane to remove Mozenter and replace him with a professional trustee. Friends and business associates may not always make suitable trustees, as the beneficiary may have a different relationship with the trustee.

Establishing an estate plan is the first step. Speak with one of our estate planning attorneys to determine if co-trustees is appropriate for your plan. Additionally, sharing your decisions and seeing if co-trustees can work together is best done while you’re still living to prevent dueling trustees from embroiling your estate in litigation.

Reference: CNBC (June 13, 2025) “Battle over Jimmy Buffett’s $275 million estate highlights risk of family trusts”

Estate Planning Impact of the “One Big Beautiful Bill Act”

On July 3, 2025, Congress passed a major taxation and spending bill commonly known as the “One Big Beautiful Bill Act“. The following provisions of the Act may be of interest to estate planning clients:

1. Increased Estate and Gift Tax Exemption. The federal estate, gift, and generation-skipping tax exemption amounts permanently increase to $15 million per person effective January 1, 2026, and will be adjusted for inflation in future years. The current exemption is $13.99 million per person.

2. Higher SALT Deduction Cap. The individual state and local tax deduction limitation (SALT limitation) increases to $40,000 and is indexed for inflation through tax year 2029, after which the cap reverts to $10,000. The cap is phased down for taxpayers with modified adjusted gross incomes over $500,000. For tax years after 2029, the cap returns to $10,000.

3. Expanded QSBS (Qualified Small Business Stock) Benefits. The Act enhances the tax exclusion under Section 1202 for QSBS as follows:

  • Provides a tiered gain exclusion for QSBS, permitting a 50% exclusion for shares held more than three years, a 75% exclusion for shares held more than four years, and a 100% exclusion for shares held more than five years.
  • Increases the per-issuer dollar cap from $10 million to $15 million (indexed to inflation beginning in 2027).
  • Raises the corporate-level gross assets ceiling from $50 million to $75 million (indexed to inflation beginning in 2027).

If you have questions about how these changes may affect your estate plan or business holdings, please do not hesitate to contact an attorney at Sims & Campbell to discuss any questions you may have regarding the “One Big Beautiful Bill Act”.

How to Incorporate Gifting into Estate Planning

There are several ways to decrease the size of a taxable estate, all while minimizing taxes to your estate and heirs. A recent article from Investopedia, “Tax-Smart Giving: How to Gift $1M Without the IRS Calling,” says the federal gift tax is applied when one individual transfers property to another and doesn’t receive anything in return.

A gift can be any transfer of funds, property, or assets, including cash gifts, loan forgiveness, or the sale of real estate for less than its market value. You may also be able to make an interest-free loan as a gift. An important note: check with your estate planning attorney to be sure any gifts align with your overall estate plan.

Who pays taxes on a gift? The federal gift tax is paid by the person giving the gift, aka the donor, and not the recipient. A portion of the value of all gifts is tax-free. In 2025, the exclusion is generous—$19,000 per person per year. A gift can be made to as many people as you want to give a gift to. Married couples may make a gift of up to $38,000 tax-free in 2025.

Unless your estate is worth more than $13.99 million in 2025, chances are you don’t have to worry about gift taxes. Annual gifts made during your lifetime are worth more than the exclusion for the applicable year, allowing for even more generosity. The gifts can be carried over to the value of your estate, making your entire lifetime gift and estate tax exclusion $13.99 million.

One caveat: the IRS should be advised annually of any non-exempt portion being carried forward, using IRS Form 709. File the form even if you don’t owe any gift taxes. This includes making gifts with a spouse, making a gift to a non-U.S. citizen spouse, or making a gift of future interests. Some people prefer to file a Form 709 to help them track their gifting, while others consider the form a minor detail to prevent unanticipated issues. If you need assistance, you can retain our firm to file this form for you.

For tax planning, you may want to give as much as possible before December 2025 ends. Some spouses give the same individual $19,000 on December 31 for one year, then make the same amount almost immediately after New Year’s Day. This is a per-year limit, making it possible for a married couple to gift $76,000 without carrying any portion over to the following year.

There’s another reason to use the lifetime exclusion.  A portability provision allows married couples to transfer any unused portions of the $13.99 million lifetime gift and estate tax exclusion to a surviving spouse.

Keep in mind that some gifts are not considered gifts. If you are writing checks for tuition or medical care, those are not considered gifts. The only way around this would be to write checks to the family members and have them use the money for tuition or medical care.

The current federal tax rate on gifts and estates is 40% in 2025. If you neglect to fill out a Form 709 and exceed the limit, you’ll have to make a sizable gift to the IRS.

Speak with your estate planning attorney and CPA about how to use these various limits to minimize your tax liability and enhance a legacy for loved ones.

Reference: Investopedia (June 1, 2025) “Tax-Smart Giving: How to Gift $1M Without the IRS Calling”

Read more about the article Why You Need an Estate Planning Attorney
Estate planning sign on a wooden pier with tall buildings in the background

Why You Need an Estate Planning Attorney

While it may seem like some estate planning documents should be easy for a person to create, the Greek philosopher Socrates said, “You don’t know what you don’t know.” This is especially true when it comes to estate planning, says a recent article, “9 Legal Documents You Should Never DIY—Here’s When to Call a Lawyer” from msn. If you create documents and they are not legally sound and enforceable, your home-made solution could cause a mess for you while living and your heirs after you have passed.

Advance Medical Directive. Having an advance medical directive document prepared allows someone you trust to make medical decisions for you if you cannot. A standardized form is just that—standard—and may not reflect your personal wishes. This document is also important for parents of young children, so a person you trust can make decisions for your children if you cannot. This document  also expresses your personal medical preferences if you can’t communicate. If your medical situation is dire and you are not likely to become conscious, it provides clear guidance for long-term care. Without this document, your loved ones will be left guessing what you would have wanted.

Power of Attorney. The POA is used to appoint a person of your choosing to handle your financial and legal affairs if you become incapacitated. The agent’s powers end upon your death. An estate planning attorney will draft one reflecting your wishes and following your state’s laws.

Revocable Living Trust. Assets placed into trusts do not go through probate, remain private, and pass directly to beneficiaries as per the instructions in the trust. An estate planning attorney will tailor the trust to your situation during life and after death.

Beneficiary Designations. When you open an investment account or purchase life insurance, you can name a beneficiary. This is the person who inherits the account or receives proceeds on your death. Many estate planning mistakes occur because people do not update their beneficiary designations, and if they do, they may not think about an outright inheritance may be a disadvantage. Note that the beneficiary designation overrides any will or trust, so be sure they are correct.

Business Succession Plan. If you own a business, this blueprint will be used to direct how the business should continue when you retire or after you die. It will address issues of leadership, family ownership and your vision for the business to continue in the future. It takes several years to create a business succession plan, and your estate planning attorney will work with family members, key employees, financial officers and CPAs to ensure a smooth transition.

Last Will and Testament. This document directs how you want your property to be distributed upon your death. Without a will, known as intestacy, your estate is distributed according to the laws of your state, usually by bloodlines or kinship, and you may not like one of these people to inherit.

Prenuptial or Postnuptial Agreements. While these documents are used in case of a divorce, they are sometimes used to support estate planning disagreements to clarify intentions. If you come to a marriage already owning assets, or if there is a big disparity in wealth, it makes sense to have an agreement in place.

Guardian Designation. If you have minor children, your last will and testament includes a guardian named to raise your children if both parents die or become incapacitated. An attorney is needed to be sure this is properly documented. Without a will naming a guardian, a court will decide who will raise your children.

Work with an experienced estate planning attorney at our law firm, Sims & Campbell, to protect your family, finances, and future, and prevent legal complications for you and those you love.

Reference: msn (March 17, 2025) “9 Legal Documents You Should Never DIY—Here’s When to Call a Lawyer”

Talking with the Kids about Finances

Many parents avoid talking to their children about finances. They may fear burdening their kids, revealing too much, or starting uncomfortable conversations. But silence can lead to confusion, mismanagement, and conflict, especially when major life events like illness, death, or inheritance occur.

Discussing your financial situation, values, and estate plan in age-appropriate ways helps children understand your intentions and prepares them to make informed decisions. Whether your children are teenagers or adults, now is the right time to open the conversation.

Why Transparency about Financial and Estate Planning Matters

An estate plan without context can leave children surprised or even hurt. Adult children who don’t understand why decisions were made may assume favoritism or hidden motives. For example, naming one child as executor or trustee without explanation may create tension if others feel excluded or mistrusted.

By explaining your decisions in life, not after death, you avoid speculation and support family unity. Transparency about how assets will be divided, what responsibilities heirs will have, and what values shaped those choices brings clarity and peace of mind.

It also encourages financial literacy. Talking about savings, investments, and long-term planning helps children, especially young adults, develop a healthy relationship with money.

What to Share with Your Kids about Your Finances (and when)

You don’t have to reveal every dollar or document. The amount and timing of what you share depends on your children’s age, maturity, and role in your plan.

For younger children, lessons may focus on budgeting, saving, and charitable giving. More detail is appropriate for adult children, especially those named in legal roles. They should understand where documents are stored, who to contact, and what responsibilities they will assume if something happens to you.

If you have concerns about how a child might handle money, such as in cases of addiction, disability, or lack of financial experience, share those concerns carefully. Explain how tools like trusts or staged inheritance distributions protect the child and your plan’s integrity.

Involving Children in Planning Conversations

In some cases, it may make sense to hold a family meeting. This doesn’t have to be a formal event, it can be a simple gathering where you share the broad outlines of your estate plan and answer questions.

This approach works well when children are expected to work together, such as managing a family property or serving as co-trustees. Knowing the plan in advance helps avoid resentment or legal battles later.

Even if you don’t disclose all financial details, letting your children know that a plan exists—and where to find it—can make all the difference during a crisis.

Working with an Estate Planning Attorney to Guide the Process

At Sims & Campbell, our experienced estate planning attorneys can help you create a plan that reflects your values and documents your decisions. They can also help guide the conversation with your family if you’re unsure how to begin.

Legal documents alone are not enough. Even the best plan can create confusion without explanation and context. Pairing strong legal tools with clear communication ensures your wishes are fulfilled and your legacy honored.

Key Takeaways

  • Talking about money builds trust: Financial conversations help children understand your values and prepare them for future responsibilities.
    Transparency prevents conflict: Explaining your estate plan while you’re alive reduces confusion and resentment after death.
  • Tailor conversations to your children’s roles: Share more details with those who will act as executors, trustees, or financial decision-makers.
  • Context matters as much as content: Understanding the “why” behind decisions fosters family unity and respect.
  • Attorneys can help structure the conversation: Legal professionals ensure your documents and discussions work hand in hand.

Reference: Cameron Huddleston (Oct. 29, 2024) “How Much Should You Tell Your Kids About Your Finances?”

Read more about the article Does a Will Take Precedence over Beneficiary Designations?
BENEFICIARY

Does a Will Take Precedence over Beneficiary Designations?

Estate planning is more than just writing a will. Some of people’s most valuable assets like retirement accounts, life insurance policies, and certain bank accounts may not pass through a will at all. Instead, these assets can be controlled by beneficiary designations filed with financial institutions.

This distinction is critical. If the information in a will conflicts with what’s listed on a beneficiary form, the beneficiary designation usually takes precedence. Understanding how these two tools work together helps prevent unintended outcomes, legal disputes, and family confusion.

How Beneficiary Designations Work

Beneficiary designations are instructions you provide directly to financial institutions indicating who should receive specific assets upon your death. These forms are typically used for:

  • Life insurance policies
  • IRAs and 401(k)s
  • Payable-on-death (POD) or transfer-on-death (TOD) accounts
  • Annuities and some brokerage accounts

When you pass away, the institution distributes the asset to the named beneficiary—no probate required. Because these transfers occur outside of the will, courts and executors are not involved.

This is why it’s crucial to keep these designations updated. For example, an outdated form listing an ex-spouse can result in that person receiving your retirement account even if your will says otherwise.

When the Will and Beneficiary Form Don’t Match

If your will names your son as the heir to your IRA but your beneficiary form lists your daughter, the financial institution must follow the form, not the will. The same applies if your will states that all assets should be divided equally among your children, but a retirement account names only one of them.

These inconsistencies can create confusion, especially if family members interpret the will as the “final word.” Unfortunately, courts always side with the financial institution’s records when a valid beneficiary form is in place.

That’s why periodic reviews of beneficiary designations are essential, especially after significant life events such as marriage, divorce, birth of a child, or death of a loved one.

When the Will Takes Priority

Assets not subject to beneficiary designations typically pass through probate and are governed by the terms of the will. These may include:

  • Personal property (furniture, jewelry, household goods)
  • Real estate not held in joint ownership or a trust.
  • Bank or investment accounts without a TOD or POD designation

In these cases, the executor follows the will’s instructions, and the assets are distributed through probate. For this reason, a will is still a vital part of every estate plan—but it is only one piece of the puzzle.

Coordinating Your Estate Plan

Your beneficiary designations, will, and trust documents should work together to avoid conflicts. An estate planning attorney can help review each component, confirm that assets are appropriately titled, and ensure your wishes are carried out consistently across all accounts and documents.

If you intend for a trust to receive retirement funds or life insurance proceeds, you must name the trust as a beneficiary or reference it in your will. Failing to do so may result in assets going to the wrong person or being subject to unnecessary taxes.

Estate planning is not a one-time event. Meet with one of our estate planning attorneys to ensure that your legal documents reflect your current wishes, relationships, and financial circumstances.

Key Takeaways

  • Beneficiary designations override wills: Assets like retirement accounts and life insurance are distributed based on the forms you file, not your will.
  • Conflicts can create confusion: Outdated or inconsistent documents may lead to unintended inheritance outcomes.
  • Wills still govern certain assets: Property without beneficiary designations passes through probate and follows the will’s instructions.
  • Coordination is key to a smooth plan: All estate planning documents should work together to reflect your full intentions.
  • Regular reviews prevent mistakes: Updating designations after life changes keeps your plan accurate and effective.

Reference: Forbes (June 2, 2015) “Your Will And Trusts Aren’t Enough: Using Beneficiary Designations As An Estate Plan”

What Does an Executor Do?

Being named as an executor is an honor and a large undertaking. You have been trusted to carry out someone’s final wishes, manage their estate, and navigate legal, financial, and emotional terrain. Before you accept the role, make sure you understand what it involves and get the support you need to do it well. You do not have to go it alone.

Obtain death certificates. Secure multiple original death certificates from the funeral home. You’ll need them to start insurance claims, close Social Security and many other future transactions.

Find the will and other estate planning documents. An estate planning attorney can help you file the will with the probate court. This is necessary for the executor appointment to be approved and the will to be validated. Once these two events occur, you can begin to settle the estate. If there is no will, an estate planning attorney should be contacted to guide the process through the courts.

Notify beneficiaries. You’ll also need to notify family members to avoid misunderstandings, even if they are not mentioned in the will. The attorney will tell you if you need to publish a legal notice in a local newspaper or other outlet. Social Security, Medicare and any other government agencies must be notified. Being transparent and thorough will prevent legal problems from occurring later on.

Secure and inventory assets. If the decedent hasn’t done so, create an inventory of all assets, including real estate, investment accounts, cars, boats and personal belongings. A thorough inventory would minimize the chances of lost assets and conflicts with heirs.

Establish an estate bank account. You’ll need to apply for an EIN number first, then you’ll be able to open an estate bank account to consolidate the deceased’s accounts. The executor uses the funds in the estate account to pay bills, debts, taxes and any estate-related expenses. A clear record will help in reporting to beneficiaries.

Manage ongoing expenses and settle debts. Utilities, mortgage payments and insurance premiums still need to be paid. By keeping them up to date, you maintain the estate’s value and prevent disruptions to essential services. If there is no money in the estate, the executor may need to sell assets to pay bills. Document everything to protect yourself from any future conflicts.

File tax returns. The executor is responsible for the decedent’s final income tax return and any estate tax returns. If the decedent lived in a state with an inheritance tax, the inheritance tax is the responsibility of the heirs, not the executor. Consult with a local estate planning attorney to be sure that the required tax payments are being made.

Have assets evaluated by a professional. An expert should value businesses, jewelry, art, collectibles and real estate. You should not do the real estate valuation, even if you are a realtor. A certified appraiser should value high-ticket items. Your estate planning attorney will have a network of experts to offer.

Pay estate taxes. If the estate is higher than the federal estate tax exemption limit, the estate will need to pay taxes within the applicable time limit. If you fail to meet the deadline, the penalties are strict and could result in substantial fines. While the current federal estate tax exemption is at an all-time high of $13.99 million per person, this may change in the future.

Distribute assets. Assets should not be distributed to heirs until all debts and other costs have been paid. Make sure to get receipts or signed agreements from beneficiaries to have proof of compliance.

Close the estate. Don’t overlook this final step. The court must be presented with a final financial summary of all financial dealings, including asset prices and debt repayment. Once the approval has been obtained, estate bank accounts can be closed and you can hang up your executor hat.

As you can see from these 11 steps, being an executor is a large responsibility. If it’s too much, speak with one of the attorneys at Sims & Campbell who can take on all or some tasks or provide guidance.

Reference: MSN (April 14, 2025) “Executor’s Checklist: 11 Essential Steps to Smoothly Settle an Estate”

Seven Ways to Include a Charity in Your Estate Plan

Many people want to give back to their communities or support causes that reflect their values. Including charitable giving in your estate plan is one of the most meaningful ways to do that. Whether you’re passionate about education, health, the arts, or social justice, your legacy can continue to make an impact long after you’re gone.

There’s no single right way to give. The best method depends on your financial situation, the assets you hold and your goals for your family and chosen charities. Thoughtful planning not only helps maximize your impact but can also provide tax advantages and avoid complications for your heirs.

1. Make a Bequest in Your Will

One of the most straightforward ways to give is by naming a charity in your will. This is known as a bequest. You can designate a specific dollar amount, a percentage of your estate, or a particular asset such as property or stocks. Bequests are flexible; you can update them at any time that you have capacity, and they allow you to support causes you care about without affecting your current finances.

2. Name a Charity as a Beneficiary

You can also name a charitable organization as a beneficiary on retirement accounts, life insurance policies, or payable-on-death bank accounts. This approach bypasses probate and allows the charity to receive the funds directly. It’s a simple and effective way to leave a gift without altering your will or trust. Naming a charity as the beneficiary of a retirement account also how additional tax saving benefits.

3. Create a Charitable Remainder Trust

A charitable remainder trust (CRT) allows you to provide income to a beneficiary, such as a spouse or child, for a set number of years or for their lifetime. After that period ends, the remaining assets go to a designated charity. CRTs are useful for people who want to support loved ones during their lifetime and still give back to charity in the long run.

4. Set Up a Donor-Advised Fund

A donor-advised fund (DAF) lets you make a charitable contribution now, receive an immediate tax deduction, and recommend grants to charities over time. DAFs are especially appealing for people who want to involve family members in charitable decisions or support multiple causes over several years.

5. Donate Appreciated Assets

Gifting appreciated stock, real estate, or other valuable assets directly to a charity can be more tax-efficient than donating cash. When you donate an asset that has increased in value, you may avoid capital gains taxes while also claiming a charitable deduction based on the full market value.

6. Fund a Scholarship or Endowment

If you want your gift to support a specific purpose, such as education or research, consider funding a scholarship or endowment. These gifts often come with naming opportunities and provide long-term support for institutions or programs that align with your goals.

7. Involve Your Family in Your Giving Plan

Estate planning is also an opportunity to share your values with future generations. Involving your children or grandchildren in charitable giving decisions can help them understand your priorities and foster a spirit of generosity. It also helps reduce misunderstandings and promotes unity around your legacy.

No matter how you choose to give, working with an estate planning attorney at Sims & Campbell is important to ensure that your intentions are clearly documented and legally enforceable. Contact our estate planning firm to put the right planning in place now so that your charitable legacy can live on for generations.

Key Takeaways

  • Bequests offer flexibility and simplicity: Naming a charity in your will allows you to give without affecting your current finances.
  • Beneficiary designations bypass probate: Retirement accounts and life insurance can be directed to charity with a simple form.
  • Trusts provide income and future gifts: Charitable remainder trusts allow you to support both loved ones and charitable causes.
  • Donating appreciated assets saves on taxes: Gifting stock or property may reduce capital gains, while supporting your favorite organizations.
  • Family involvement strengthens your legacy: Including your heirs in charitable decisions fosters shared values and long-term impact.

Reference: Ameriprise Financial “Estate planning and charitable giving: Strategies to make an impact with your estate”

Should You Worry About Death Tax Liabilities?

If you own real estate, investment accounts, or significant personal property and wish to transfer those assets to your loved ones, at a minimum, you need a will. But a comprehensive estate plan does more than just distribute assets, it anticipates and mitigates potential tax liabilities that could reduce the legacy you intend to leave behind.

A recent Go Banking Rates article, “Inheritance Tax 2025: Rates, Exemptions and How to Avoid It,” underscores the importance of proper planning. Even if your estate falls below the current federal estate tax exemption—$13.9 million for 2025—it may still be subject to state-level inheritance taxes, which are imposed independently of federal rules.

Which States Impose Inheritance Taxes?

Several states continue to levy inheritance taxes, which may be paid by the heirs rather than by the estate. Maryland and Pennsylvania, for example, impose such taxes. If you reside in one of these states, or have beneficiaries who do, it is essential to take proactive steps to avoid saddling your heirs with unexpected tax burdens.

Strategies to Minimize or Eliminate Estate and Inheritance Taxes

Fortunately, there are several legal strategies available to reduce, or in some cases eliminate, estate and inheritance tax exposure. These include:

1. Lifetime Gifting

The federal annual gift tax exclusion allows individuals in 2025 to give up to $19,000 per recipient without triggering gift tax or IRS reporting obligations. Married couples can combine their exclusions to gift up to $38,000 per person per year.

Larger lifetime gifts can further reduce the size of your taxable estate. While these may count against your federal lifetime estate tax exemption, many states with inheritance taxes do not impose tax on lifetime gifts, making gifting a useful planning tool.

2. Trust-Based Planning

Trusts can be instrumental in removing assets from your taxable estate. The type of trust selected depends on your specific planning goals:

  • Irrevocable Trusts: Transfer ownership of assets out of your estate, although they require relinquishing control over those assets.

  • Qualified Personal Residence Trusts (QPRTs): Allow you to transfer a residence to heirs at a reduced gift tax cost.

  • Bypass Trusts (Credit Shelter Trusts): Commonly used by married couples to fully utilize both spouses’ estate tax exemptions and reduce overall tax exposure.

Proper trust selection and implementation require careful drafting and should be handled by an experienced estate planning attorney to ensure tax efficiency and legal validity.

3. Charitable Giving

Charitable contributions made to qualified 501(c)(3) organizations are fully exempt from estate and inheritance taxes. Options for charitable giving include:

  • Outright Bequests: Gifts made through your will.

  • Lifetime Donations: Gifts made during your lifetime may also carry current-year income tax benefits.

  • Charitable Trusts:

    • Charitable Remainder Trusts (CRTs) provide income to your heirs for a fixed period, after which the remainder goes to charity.

    • Charitable Lead Trusts (CLTs) do the reverse, providing income to a charity first, with the remainder passing to your heirs.

Estate and inheritance tax laws are complex, frequently changing, and vary significantly from state to state. To ensure that your legacy is preserved and your heirs are protected from unnecessary tax burdens, consult with an experienced estate planning attorney.

At Sims & Campbell, we help individuals and families navigate the legal and tax implications of wealth transfer with clarity, compassion, and precision. Schedule a consultation to understand your estate tax obligations and create a tailored plan that aligns with your goals.

Reference: Go Banking ( April 14, 2025) “Inheritance Tax 2025: Rates, Exemptions and How to Avoid It”

What to Do After Spouse Dies

The death of a spouse brings not only grief but also significant financial and legal responsibilities. Many surviving spouses are unprepared for the number of tasks required to settle an estate, update legal documents and secure their financial future. While it may feel overwhelming, addressing these issues promptly helps prevent unnecessary complications and ensures that assets and benefits are properly managed and protected.

Immediate Steps to Take

In the first few days following a spouse’s passing, several critical steps must be completed. Obtaining multiple copies of the death certificate is essential, as financial institutions, insurance companies and government agencies will require official documentation. A funeral home or county records office typically provides these certificates.

If your spouse had a will or trust, locating these documents should be a priority. The executor or trustee will need to begin the process of distributing assets and handling the estate. If no will exists, the estate will be administered according to the state’s intestacy laws, which determine how assets are distributed.

Contacting the Social Security Administration is also necessary. If your spouse was receiving Social Security benefits, those payments will stop. You may be eligible for survivor benefits, which can provide financial support. If your spouse had life insurance, now is the time to file a claim to receive the policy’s payout.

Managing Finances and Estate Settlement

One of the most challenging aspects of losing a spouse is adjusting to financial changes. Start by notifying banks, credit card companies and investment firms to update account ownership and remove your spouse’s name. If accounts are held jointly, they may be transferred automatically. However, individual accounts may need to go through probate before funds can be accessed.

Mortgage lenders, utility companies and insurance providers should also be informed. If your spouse had outstanding debts, it is important to determine whether you are legally responsible for them. Some debts may be covered by life insurance or paid off using estate assets.

If your spouse had a trust, their assets may pass directly to beneficiaries without the need for probate. However, if they only had a will or no estate plan, probate court proceedings will be required. A probate attorney can guide you through the process, ensuring that debts are paid, and assets are distributed correctly.

Updating Legal and Financial Documents

A spouse’s death often requires updating legal documents to reflect your new situation. Suppose your spouse was listed as a beneficiary on retirement accounts, life insurance policies, or payable-on-death bank accounts. In that case, you may need to update these designations to ensure that your assets are distributed to the intended individuals.

Estate planning documents, such as your will, trust, or power of attorney, should also be reviewed. If your spouse was named as your agent, executor, or trustee, you will need to appoint a new person to handle these responsibilities. Failing to update these documents could lead to confusion or disputes in the future.

Property ownership should also be reviewed. If you and your spouse owned a home together, you may need to update the deed to reflect sole ownership. Some states allow property to transfer automatically, while others require filing new paperwork with the county.

Planning for the Future

Beyond handling immediate legal and financial matters, it is important to consider long-term financial planning. Adjusting to a single income may necessitate adjustments in budgeting, investment strategies, or retirement planning. If your spouse had pension benefits, annuities, or employer-sponsored retirement plans, determine whether you are eligible for continued payments or survivor benefits.

Your spouse’s passing may also impact taxes. Filing a final tax return for your spouse is required, and additional estate or inheritance taxes may be due, depending on the estate’s value. Consulting with a financial advisor or estate attorney can help you navigate these complexities and make informed decisions about managing assets moving forward.

Reach Out for Legal Guidance

The loss of a spouse is life changing. However, taking the right steps can help ease the burden. Seeking legal and financial guidance ensures that assets are handled correctly and that your financial future remains secure. Get in touch today to schedule a consultation with our estate administration team and find the assistance you need.

Key Takeaways

  • Gather essential documents immediately: Death certificates, wills and trust documents are needed to settle financial and legal matters.
  • Notify financial institutions and government agencies: Social Security, banks and insurance providers must be informed to update accounts and process benefits.
  • Review estate planning and beneficiary designations: Updating wills, trusts and account beneficiaries prevents complications in the future.
  • Manage property ownership and debts carefully: Contact mortgage lenders, creditors and utility companies to settle outstanding obligations.
  • Plan for financial stability: Adjusting to a single income requires reviewing budgets, investments and tax considerations.

Reference: Principal Financial Group (Dec. 19, 2023) “What to do when your spouse dies: a financial checklist”