As you retire in Virginia, it is important to reassess and update your estate plan to align with the specific considerations of this stage in life.
After all, estate planning is not a one-size-fits-all endeavor. Virginia retirees should be mindful of certain aspects unique to their state.
Inheritance tax laws
Virginia does not impose an inheritance tax, meaning heirs do not have to pay state taxes on their inheritance. However, federal estate taxes may still apply, depending on the overall value of the estate. Stay on top of any changes in federal tax laws that might impact your estate.
For many retirees, real estate is a significant part of their assets. Review and update property titles, ensuring they reflect your current wishes. This step helps streamline the transfer of property to heirs such as your spouse, minimizing potential complications. Additionally, consider discussing the option of a transfer on death deed, which allows the transfer to go to your beneficiaries while avoiding probate. This type of deed does not make sense in all situations so it is a good idea to discuss with an attorney.
Retirees often have various financial accounts, such as retirement plans and life insurance policies. Updating beneficiary designations on these accounts is necessary. Ensure that these designations align with your current wishes, as beneficiary designations supersede instructions in your will. Failing to update beneficiaries may lead to unintended consequences, potentially leaving assets to individuals you did not intend.
If you have dependent family members, such as minor children or adults with disabilities, designate guardianship in your estate plan. Clearly outline your preferences for their care and financial support, ensuring a smooth transition in the event of your incapacity or passing.
Regularly reviewing and, if necessary, revising your plan ensures that it remains a reliable reflection of your wishes as you enjoy your retirement in Virginia.