The Tax Cuts and Jobs Act was signed into law on December 22, 2017 and represents the most significant reform of the U.S. tax code in over 30 years. Before we get into the details, you should be aware that almost everything listed below expires after 2025, and the tax structure reverts to its current form in 2026 unless Congress acts between now and then. However, the corporate tax rate cut from 35 percent to 21 percent does not expire.
Like other Texans who are at or reaching retirement age, your parents may not be particularly interested in discussing estate planning. However, as they continue to get older or develop chronic health issues, you may need to push them into considering it gently.
The median cost of a private nursing home room in the United States has increased to $97,455 a year, up 5.5% from 2016, according to Genworth's 2017 Cost of Care survey, which the insurer conducts annually. Genworth reports that the median cost of a semi-private room in a nursing home is $85,775, up 4.44% from 2016. The rise in prices is much larger than the 1.24% and 2.27% gains in 2016.
Estate planning is not just about your assets that have a substantial monetary value. Sometimes sentimental items can be even more important to your heirs.
With Republicans in control of Congress and the presidency, there is talk of eliminating the federal estate tax. In 2017 the tax affects only estates over $5.49 million, meaning that for more than 99 percent of Americans, it's already been repealed. With no estate tax, do you still need a trust? While trusts can be used to shelter assets from the estate tax, trusts have many other valuable estate planning uses.
If you intend to leave assets to a loved one with special needs, his or her eligibility for government benefits could be put at risk in the absence of proper planning.
A little-known insurance option can be an answer for some people who might need care but are unable to buy long-term care insurance. Short-term care insurance provides coverage for nursing home or home care for one year or less.