Before we get started, on an exciting note our team at Innova Wealth Partners is proud to announce “We Won!” We want to thank those individuals that nominated us and voted for us! In 2018, a total of 343,842 votes were placed for all contestants. For more information and to view all the winners here is a link directly to the Best of Bucks Awards.
And now onto the newsletter…
Financial planning and estate planning go together like peanut butter and jelly. One can be used without the other, but together they work in harmony. One attraction of this fantastic sandwich is its simplicity, and it shares this characteristic with Transfer on Death (TOD) accounts.
Transfer on death accounts avoid probate (an estate planning goal for many individuals) because the assets transfer automatically to the named beneficiary(s) when the owner dies. Similar to an IRA or 401(k) account that has a beneficiary, the transfer on death account allows an individual or joint brokerage account to have a beneficiary as well (bank accounts have a similar option called Payable on Death account).
- The TOD account should only be considered in conjunction with estate planning & financial planning. As an example, if you have spent time with an attorney carefully crafting a will, adding the TOD titling to your brokerage account would supersede your will and potentially ruin the careful planning that was previous created.
- While the TOD account will avoid probate, this type of account does not allow the avoidance of estate and inheritance tax at the federal or state levels. Placing all assets in TOD accounts could actually make the estate settlement process more complicated, the opposite of its original intention.
- The Uniform Transfer On-Death Security Registration Act is a state law. While most states have adopted it, there are substantial variations state-by-state. One example is that some states now allow real estate to transfer on death with a TOD deed.
TOD accounts are easy to establish (usually a 1- or 2-page form at most financial institutions), and can be an effective estate planning and financial planning tool. While these accounts have been around for more than 20 years, we find that people have not heard of them or do not know their potential benefits. If this is something that could benefit you, please don’t hesitate to call your advisor at Innova Wealth Partners and we’ll be happy to discuss your options.
Innova Wealth Partners, LLC (“Innova”) is a registered investment advisor. Information presented herein is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed.
Readers of the information contained on these performance reports, should be aware that any action taken by the viewer/reader based on this information is taken at their own risk. This information does not address individual situations and should not be construed or viewed as any typed of individual or group recommendation. Be sure to first consult with a qualified financial adviser, tax professional, and/or legal counsel before implementing any securities, investments, or investment strategies discussed.
Innova has been nominated for and has won several awards. Innova did not make any solicitation payments to any of the award sponsors in order to be nominated or to qualify for nomination of the award. [The basis for each award presented on this website is provided by accessing the Internet link to the award sponsor which is available by going to the award sponsor’s icon or name shown on the web pages herein.]
The tax information and estate planning information contained herein is general in nature, is provided for informational purposes only, and should not be construed as legal or tax advice. Innova does not provide legal or tax advice. Innova cannot guarantee that such information is accurate, complete, or timely. Laws of a particular state or laws that may be applicable to a particular situation may have an impact on the applicability, accuracy, or completeness of such information. Federal and state laws and regulations are complex and are subject to change. Changes in such laws and regulations may have a material impact on pre- and/or after-tax investment results. Innova makes no warranties with regard to such information or results obtained by its use. Innova disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information. Always consult an attorney or tax professional regarding your specific legal or tax situation.