Passing on assets to heirs checklist

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Your estate is a legacy. Here's a checklist to help you make the planning process efficient and effective.

General considerations

  • Check provisions for your spouse, your dependents and your financial obligations. Although requirements may vary from state to state, you may have more flexibility for some allocation decisions than for others.
  • Consider the ages of your intended beneficiaries. Minors and disabled heirs may require special guardianship or trust arrangements.
  • Provide for contingencies in case circumstances change. For example, if a primary heir is unwilling or unable to receive the bequest, you could define how that person's share is to be distributed.
  • Estimate your potential estate, gift or inheritance tax liabilities. The federal estate tax applies to only the largest estates. For an individual, $13.61 million is excluded from tax consideration in 2024, and a surviving spouse may benefit from the couple's combined exclusion value. But state laws vary widely and, in some cases, can apply to a much wider range of inheritance scenarios. In many states (and for the federal tax), any liability is assessed on the estate itself. But in some states, taxes may be collected directly from the heirs.
  • Address your philanthropic goals. You may be able to use specialized trusts to gain tax advantages while also providing for heirs and for favored charities. For example, you can look into whether charitable lead trusts or charitable remainder trusts could meet multiple goals for you.

Specific considerations for different assets

Shares of a business you own

  • Determine who among your heirs might be most willing and able to take responsibility for the business
  • Consider a system that gives passive shareholders a stake in any potential business profits without actively participating in the business
  • Provide for key employees as well as family members
  • Discuss succession issues with partners or co-owners

An investment portfolio in a taxable account

  • Determine whether the intended heirs could manage their portfolios effectively without professional advice
  • Consider delegating portfolio control to a person or institution able to assume fiduciary responsibilities

Assets in a retirement account

  • Review the beneficiary designations of your retirement accounts to be sure that they are consistent with your intentions. Keep in mind that account beneficiary designations will override any provisions of your will.
  • Consider rolling over employer-sponsored plan assets into one or more IRAs for beneficiariesFootnote 1
  • Weigh the potential benefits of converting a traditional account to a Roth account
  • Assess the tax implications of each potential distribution scenario

Real estate (primary residence and vacation property)

  • Decide whether you want your heirs to share use of the property or just receive the cash equivalent of the property's estate value
  • Consider how heirs sharing a property can collectively manage the costs of ownership and maintenance
  • Consider how a partner in any joint ownership you set up could leave the partnership in the future
  • Consider alternative provisions for heirs who might have no interest in actively using the property

Personal property with significant financial worth or sentimental value

  • Obtain realistic assessments of current worth for art, antiques or jewelry
  • Determine whether any heir might have significant sentimental interest in any item and provide for those special interests
  • Talk with heirs about ways to apportion unique items
  • Ensure that your executor can locate and gain access to estate documents stored in safes, vaults and safe-deposit boxes
Suggested for you

You have choices about what to do with your employer-sponsored retirement plan accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over an employer-sponsored plan from your old job to your new employer, take a distribution, or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment (particularly with reference to employer stock), and different types of protection from creditors and legal judgments. These are complex choices and should be considered with care. For more information visit our rollover page or call Merrill at 888.637.3343.
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The material was authored by a third party, DST Retirement Solutions, LLC, an SS&C company ("SS&C"), not affiliated with Merrill or any of its affiliates and is for information and educational purposes only. The opinions and views expressed do not necessarily reflect the opinions and views of Merrill or any of its affiliates. Any assumptions, opinions and estimates are as of the date of this material and are subject to change without notice. Past performance does not guarantee future results. The information contained in this material does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation, offer or solicitation for the purchase or sale of any security, financial instrument, or strategy. Before acting on any recommendation in this material, you should consider whether it is in your best interest based on your particular circumstances and, if necessary, seek professional advice.

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