Is It Time To Review Your Trust Formulas?

As it is always good policy to review your estate litigation documents when there are changes in your personal life; such as: divorce, new children, or new career. It is also important to make reviews when there are new changes to the federal estate tax laws. Especially, if you have a trust instrument which relies on formula clauses to take advantage of the federal estate tax exemption. An amount that continues to change over the years.

For instance, if you had created your trust in 2008 and had an estate valued at $4 million you would have only used formulas that allowed for $2 million to qualify for the exemption and the other half to possibly go directly to your spouse. However, now that the exemption amount is up to $5 million, the formula you initially had may no longer be appropriate to take advantage of the exemption and could leave your spouse with limited access to funds.

Please consult with a professional estate litigation Attorney to find out more about formula clauses or to review and update your existing estate litigation documents.

*This blog entry was not written by an Attorney and should not be constituted as professional legal advice.

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