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Estate Planning During the COVID-19 Pandemic: 5 Things to Consider


Since the beginning of the COVID-19 pandemic, federal and state agencies have taken unprecedented steps to ease the economic burden. In particular, the U.S. government extended some tax filings deadlines and introduced changes that could impact probate court filings and other estate planning processes.

5 Things to Consider for Estate Planning in the Coronavirus Era

If the coronavirus crisis prompted you to think about getting an estate plan or updating your current plan, consider the following factors that have arisen during the pandemic:

  1. Extended tax filings and payments. The Internal Revenue Service extended the federal income tax filing and payment deadline to July 15, 2020 (from April 15, 2020). This tax filing and payment extension means that the U.S. taxpayer does not need to file certain tax returns until July 15.

The IRS also extended deadlines for:

  • Payments;
  • Filing obligations; and
  • Other tax-related actions that are due on or after April 1, 2020, and before July 15, 2020.

The deadlines for all the actions related to taxes that must be performed during this period were extended to July 15 of this year.

For example, federal estate tax returns due between April 1 and July 15 are now due July 15, 2020. Taxpayers do not need to file any forms or petitions to take advantage of this relief during the COVID-19 pandemic, as these extensions become effective automatically.

Given the volatile nature of the COVID-19 pandemic, the IRS and other federal or state agencies may issue new guidance regarding taxes and estate planning. Talk to your estate planning lawyer about your options.

  1. AGI Charitable Contribution Deduction. AGI refers to adjusted gross income. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) removed the 60% of AGI limitation on cash contributions to public charities. During the COVID-19 pandemic, donors may deduct charitable cash contributions up to 100% of their AGI. The only exceptions are donor-advised funds and private foundations.
  2. Low Interest Rates for Estate Planning. The U.S. government set certain interest rates for intrafamily loans and estate planning strategies at unprecedentedly low levels. The Applicable Federal Rate for a loan of up to three years is 0.91% for April and 0.25% for May. The rate for loans of more than nine years is 1.44% for April and 1.15% for May.
  3. Updating Medical Directives. For those who already have an estate plan, the COVID-19 pandemic may serve as a reminder to update information about their health care proxy and advanced directive. This document allows you to designate a person who would assist with medical decisions on your behalf when you are unable to. Others may want to update their nomination under their Living Will to set forth their healthcare instructions and wishes.
  4. Reviewing Your Estate Planning Documents. The COVID-19 pandemic has highlighted the importance of having an up-to-date estate plan that reflects your wishes. For this reason, review not only your medical directives, but also wills, trusts, durable powers of attorney, beneficiary designations, and other critical documents.

If you do not have a plan, it is important to speak directly to an attorney instead of online do-it-yourself platforms. Instead, talk to our St. Petersburg estate planning attorneys to review your case. Contact Legacy Protection Lawyers, LLP, for a case review at 727-471-5868 to receive a telephone or video consultation.




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