Gifting An Early Inheritance To Your Loved Ones
Estate planning is one of the most important things anyone can do. After you have created a plan, you will know that when you are gone, your loved ones will still be taken care of. You will also have the reassurance that your last wishes will be known and fulfilled. However, what if you want to give your beneficiaries an early inheritance? There are many reasons people do this. Sometimes, beneficiaries have current needs an inheritance could help with. Or, perhaps you simply want to see the people you love enjoying their inheritance. Whatever your reasons are for doing it, below are four ways you can gift an early inheritance.
Giving the Inheritance Outright
One of the easiest ways to transfer ownership of your property is simply to give it away. When the property is a sum of money, you can gift this to your beneficiaries without having to worry about changing the title of a vehicle or the deed on your home. The only thing you really have to worry about is that you do not give so much away that you are left in a vulnerable position financially.
Modifying the Deed on a Home
If you change the deed on your home, your beneficiaries could share legal ownership of it. Modifying the deed on the home can create a joint tenancy deed with rights of survivorship. This means that after you pass away, ownership of the home can be transferred to your beneficiaries immediately and without the need for the property to go through probate. It is important to remember that if you modify the deed on your home and your loved ones do not pay their debts, creditors could try to seize the property. This could result in the sale of your home. To avoid this situation, you should consider a transfer-on-death designation.
The Education Exclusion
The education exclusion tool allows you to pay for a beneficiary’s tuition at an eligible post-secondary school without paying taxes on the gift. The education exclusion tool allows you to help pay for the cost of your loved one’s tuition and relieves them of the financial burden that student loans often bring.
The Medical Exclusion
The medical exclusion is very similar to the education exclusion. Of course, instead of using this tool to pay for your loved one’s education, you can use it to pay for their medical expenses and the gift will not be subject to taxes. In Daytona Beach, and throughout the entire country, medical expenses can be very costly. If you are able to and want to gift an early inheritance, paying for these costs can help your loved one avoid debt if they cannot afford to pay it themselves.
Our Estate Planning Lawyer in Daytona Beach Can Provide the Legal Advice You Need
Gifting an early inheritance must be done very carefully so you do not incur certain penalties. At Bundza & Rodriguez, our Daytona Beach estate planning lawyer can advise on how to do it so you, your future, and your family are fully protected. Call us now at 386-252-5170 or contact us online to schedule a free consultation and to learn more.