EXPANDED 529 PLAN BENEFITS FOR ELEMENTARY AND SECONDARY SCHOOL EDUCATION

♠ Posted by Marc J. Soss in 2018 529 Plans,529 Plan Benefits,education expenses,qualified education expenses,student aid eligibility,Tax Cuts and Jobs Act of 2017,Trump Tax Plan,young adult estate planning

The new Tax Cuts and Jobs Act of 2017 (the “Act”) brings a new savings opportunity for those who desire to put away funds for a child, grandchild or other family members future education expenses. The Act, which went into effect on January 1, 2018, expands the use of 529 Savings Plans (“529 Plan”). A 529 Plan is legally known as “qualified tuition plans,” are sponsored by states or educational institutions and are authorized under Section 529 of the Internal Revenue Code. 529 Plans were designed to encourage saving for future college costs and provide for qualified higher education expenses (tuition, fees, books, supplies, computers and related equipment). 529 plans also have no income, age or annual contribution limits. Although contributions to a 529 Plan are not federal tax deductible, the contributed funds will grow federal income tax-free and will not be taxed when taken out to pay for qualified higher education expenses. The Act now allows for a 529 Plan's payment of qualified education expenses for attendance at an elementary or secondary school. This amount is capped at $10,000 per plan beneficiary per year. It is important to note that assets held in a 529 account owned by a grandparent, other relative or anyone else besides a dependent student or one of their parents will have no adverse impact on the student's ability to apply for federal student aid. However, the withdrawal of funds to pay for the child’s qualified education expenses will count as student income for purposes of their eligibility for federal student aid.

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NEW STATE OF WASHINGTON POWER OF ATTORNEY STATUTE

♠ Posted by Marc J. Soss in estate planning,new washington law,Power of Attorney,probate lawyer,protection planning,Sarasota estate planning,washington,young adult estate planning

The new State of Washington Power of Attorney statute went into effect on January 1, 2017 (“Act”). The Act provides several changes and additions to the previous law, which aim to address previous ambiguity in the law and to provide safeguards to prevent possible abuse of authority by an agent under the power of attorney. Some of the key provisions of the Act are: Agent/Attorney in Fact: If the principal names co-agents to act on his or her behalf, the Act now clarifies that co-agents must exercise their authority jointly, unless the document specifies that each co-agent may act independently. When Effective: Under the Act, a power of attorney must now expressly state that the document is not affected by the disability of the principal, or that it becomes effective upon the disability of the principal in order for the power of attorney to be “durable” and not affected by the principal’s subsequent disability. The powers granted to the agent may be effective immediately upon signing or may spring into effect only when the principal becomes incapacitated. Powers Granted to Agent: The Act allows the principal to grant authority to the agent over broad subject matters, including but not limited to, the authority to manage the principal’s real and personal property, stocks, bonds, and other financial instruments; to make gifts; to manage the principal’s estate, trusts, and other beneficial interests; and to manage and operate a business. By drafting the power of attorney to refer to certain specific categories of powers the agent may be granted, the power of attorney can incorporate the more detailed descriptions of these powers set forth in the Act. This could eliminate ambiguity in the document itself regarding the scope of the agent’s particular powers and may allow the power of attorney document itself to be simplified. Under the Act, the authority to make gifts is limited to the amount of the federal gift tax annual exclusion ($14,000 per year to each recipient) unless otherwise stated in the document. Formalities: The principal’s signature must either be: (i) acknowledged by a notary; or (ii) attested by two or more witnesses, who are competent, and are not home care providers for the principal or related to either the principal or agent by blood or marriage.

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ESTATE PLANNING DOCUMENTS - DONT LET YOUR CHILDREN LEAVE HOME WITHOUT THEIRS IN PLACE

♠ Posted by Marc J. Soss in estate planning,Estate planning attorney,florida estate planning,Florida Guardianship,Power of Attorney,Sarasota attorney,young adult estate planning

Becoming an empty nester and watching your child(ren) leave the home (for school or a job) can be difficult emotionally. Reality is that when a child reaches the age of 18 they are a legal adult, even though they may still depend on you for financial and emotional support. Most parents are surprised to learn that once a child turns age 18 they are not legally permitted to make financial or medical decisions on their behalf, or even be notified if their child is in the hospital emergency room. To avoid this from happening, it is important to have your child(ren) create their own estate planning documents (Power of Attorney, Health Care Surrogate and Living Will). Estate planning documents are not just for the older generation. These documents will provide authority and allow a parent or family member to step in, when a child needs financial or medical assistance and the child is unable to make such decisions for themselves. Alternatively, a parent will have to commence a guardianship proceeding to obtain legal authority to assist the child. Having your child(ren) execute these documents once they reach age 18 and before they leave home will provide you with piece of mind.

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