Stock Market Analysis and Personal Finance Mr. Bernstein Estate Planning and Taxes, pp June 12, 2015

Stock Market Analysis & Personal Finance Mr. Bernstein Estate Planning Definition of an Estate: All property and assets owned by an individual or group Estate includes money, securities, real estate, business interests, receivables, and intellectual property (including social media information) Estate Planning is therefore the process of a detailed plan to distribute those assets to beneficiaries of your choice upon your death, and to minimize taxes 2

Stock Market Analysis & Personal Finance Mr. Bernstein Types of Wills Simple Will leaves everything to a spouse Other Wills may divide assets between spouses, children, family, friends or charities. State law may mandate a minimum for spouses Typically expressed in percentages, not dollars – why? Often specifies specific assets to specific beneficiaries Should be updated with every major life change 3

Stock Market Analysis & Personal Finance Mr. Bernstein Will Basics An Executor is selected to carry out the tasks in the will; alternates or contingents are named also Probate Courts validate wills and insures debts are paid Living Trusts avoid expensive and lengthy probate process and reduces taxes Assets are transferred to a trustee, along with instructions on who receives benefits during your lifetime as well as upon your death 4

Stock Market Analysis & Personal Finance Mr. Bernstein Executor Responsibilities Take inventory of belongings Appraise and distribute assets Pay Taxes Settle Debts Legally Obligated to Act in the Interests of the Deceased, as directed by the Will You must file a legal document if named but unable or unwilling to serve as Executor 5

Stock Market Analysis & Personal Finance Mr. Bernstein Taxes and Estate Planning Estate Taxes are as high as 40% (Federal) and 16% (NJ) Current Federal exemption is the first $5.25mm but current New Jersey exemption is only $675,000 Insurance policies can be used to insure cash available to pay estate taxes without selling assets 6