There are many times in life when you may need to be making changes to your estate planning documents. Expanding families, marriage, divorces, starting new businesses and moving to new states are just a few.
An important instance for updating your estate plan is when you go through real estate transactions. Real estate is likely some of the largest property that you have, so changes surrounding that property can have a big impact on your estate.
Real estate in business
Are you buying or selling real estate for your business? That may also mean that the size and value of your business is changing. Any time that there is a significant change in the value your estate, you may need to reassess your estate plan.
Real estate transactions can have an impact on the growth of a business. Perhaps you will need to reconsider your beneficiaries and who is most capable of handling a now-growing company. If you are reconsidering your plans to dissolve or sell the business when you pass, you may now want to consider passing it to a beneficiary. The changing value of your business real estate could also create an uneven distribution of assets among your beneficiaries that result in tensions.
Personal real estate
If you are buying or selling a home, you will need to reassess how it is dealt with in your estate plan. Perhaps you are moving down South for the warm weather. Which of your children would be the best beneficiary of a home in another state?
If you are downsizing or moving to an elder care facility, you may need to reassess who the beneficiary of your original home was. These changes may mean that you want to redistribute your assets so that they are fair among your loved ones.
As you consider how your real estate transaction may affect your estate plan, it can be helpful to have appraisals of your assets that can help inform your decisions. This includes considering the value of property and the tax impact that inheriting a piece of real estate can have.