Money that has been awarded from a personal injury settlement could have an impact on the value of your assets. It will be wise to have an understanding of the impact a settlement could have on your estate. As any personal injury attorney with experience can attest, a personal injury settlement award can benefit victims of an accident immensely. Contact an estate planning attorney for their support in putting together an estate plan that takes into account your personal injury settlement.
Documentation: What You Need Following an Accident
A number of financial losses can occur when a person is in the midst of a personal injury settlement. If a person suffered from injuries that were disabling, the victim who was injured may be awarded hundreds of thousands of dollars in settlement money. When it comes to the personal income or assets of an individual, this could have a major impact. The person may need to adjust certain documents to reflect their current financial standing in order to document expenses and compensation from the accident. Paperwork that may be needed in a legal setting may include documents such as wills and estate planning. When it comes to assets, it is important that you are careful not to over-report. In the event that the estate is assessed at a higher value, you could incur high federal estate taxes if expenses are not correctly accounted for.
How Federal and State Taxes Impact Estate Planning
Although in some situations, federal estate taxes can be exempt, there are limitations to this. The recipient of an award may need to comply with federal regulations by changing their estate plan once a settlement reaches the limit. It is important to know the laws within your states because some estate taxes are not fixes and, in some situations, states do not charge a property tax at all. Depending on where you live, you could be required to pay either one type of tax or in some situations both.
You may choose to hire someone who can invest your money in a fund that is safe and effective once you receive your settlement. You will want to keep your award money safe from any fees and taxes that are unnecessary while working with someone who can help you with planning for your expenses.
When a personal injury settlement is involved, it is beneficial to plan your estate with an experienced Sacramento estate planning lawyer. Contact an estate planner today to make a plan for your assets.
Thanks to our friends and contributors from Yee Law Group for their insight into estate planning.