How Can Accountants Help With Estate Planning?

Estate planning is an important aspect of inter-generational financial management that is usually managed within family groups. Planning on what will happen to estates means working out how an individual's assets will be managed and allocated either because they have died or, under some circumstances, have been incapacitated. While the role of lawyers in this process is well-known, accountants also have indispensable advice to offer. Learn more about why planning what to do with estates should often involve oversight from a professional in accounting.

Tax Implications

To begin with, one of the main concerns in estate planning is understanding the tax implications, especially in states where inheritance tax may apply. Beneficiaries of estates in Nebraska, New Jersey, and Iowa, for example, may sometimes face the challenge of navigating complex tax obligations when inheriting assets, depending on how they were related to the deceased. Accountants can provide invaluable insights to minimize these taxes in a legal and fair manner. By strategically structuring asset distribution in advance with careful planning, they can help reduce inheritance burdens and the other taxes associated with estates to ensure beneficiaries receive the maximum possible inheritance.

Expert Valuations

Note that the valuation of assets is an essential step in all estate planning, something that is often needed before lawyers get involved. Valuations determine how much each constituent part of people's estates is worth, including their real estate, their investments, and other sorts of property, too. Thanks to their experience in financial analysis, accountants should be able to evaluate both tangible assets like property and intangible ones like business interests accurately.

Trust Planning

Among larger estates, it may be advisable to have someone on your side with expertise in estate planning trusts. To boil it down somewhat, estate trusts are complex legal entities that are often used to manage and distribute assets. Different types of trusts come with notable financial implications, so choosing the right one takes professional experience. Accountants can provide clarity on trusts, offering their clients guidance in setting up ones that align with their financial goals most closely.

Financial Planning

Lastly, estate planning should take into account the broader financial strategy of the person who is planning what to do with their estate when they no longer run it. Since accountants often play a role in managing an individual's finances, they are often also best placed to ensure that the estate plan is consistent with other financial objectives until the time comes for it to be passed on.

Contact a professional to learn more about estate planning.