Should I Hire an Estate Planning Attorney Now That I Am a Widow?

Many estates are simple enough where no help is needed, but there are several situations where anyone would be much better off getting some professional support.

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Not everyone needs to hire a lawyer when their husband dies. However, there are some circumstances that make you a good candidate for handling the estate with a professional at your side. Of course, not every one of them needs to apply to your situation — but the more that do, the more critical it will be to hire a qualified estate planning attorney.

Here are four types of estate situations that could call for professional legal help.

Estates with many types of complicated assets

Hiring an estate planning attorney is a must for more complicated estates — like those with multiple investments, lots of assets, alternative investments, such as cryptocurrency, hedge funds, private equity or a business. Some estates also include significant real estate, including primary homes, vacation homes, commercial properties and timeshares.

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Managing, appraising and selling a business, real estate and complex investments are all tasks that require some expertise and experience. In addition, valuing private equity investments and certain hedge funds is also not straightforward and can need an expert.

The estate might owe either federal or state estate tax

According to Marc Zimmerman, an attorney in Kane Kessler's Trusts, Estates and Taxation practice group, “In some estates, there are time-sensitive decisions that require somewhat immediate attention. Even if all assets were held jointly and court involvement is unnecessary, hiring a knowledgeable trust and estate lawyer may have significant tax benefits. There are many planning strategies that clients can benefit from.”

For example, Zimmerman shares that the Will or an Estate Tax Return may need to be filed to transfer the deceased spouse’s unused Federal Estate Unified Tax Credit to the surviving spouse.

Zimmerman advises, “These decisions of whether or not to transfer to an unused unified tax credit to the surviving spouse are not obvious and require guidance from a qualified estate attorney.”

One might want to transfer this credit if there is a worry that the estate might exceed the exemption or is likely to in the future. The unified tax credit protects up to $12.06 million for individuals and $24.12 million for married couples filing jointly from gift and estate taxes. The credit covers all gifts made during the decedent’s lifetime and the monies left to loved ones at death.

Surviving spouses might also worry that the government may reduce the federal exemption limit from $12.06 million to a much smaller number as was proposed in 2021 as part of Biden’s Build Back Better Act.

Under the current tax law, this high estate and gift tax exemption will “sunset” in 2026. The exemption will then return to only $5.49 million adjusted for inflation, which is expected to be roughly $6 million.

If a person passes away in 2026 with an estate of $10 million and assuming the exemption amount is approximately $6 million, $4 million would be taxable. Estate tax rates can skyrocket up to 40%, and in this case would cause a seven-figure tax bill.

In addition, around 20 states now impose their own estate taxes, and many of these states impose taxes on an estate valued at $1 million or more. So when you add the value of a home, investments and life insurance proceeds, many Americans will find themselves on the wrong side of the state exemption and owe estate taxes to Uncle Sam.

The family is fighting

Family disputes often erupt after a death. Emotions are high, and no one is operating at their best. If disgruntled family members want to contest the will or are threatening a lawsuit, you will also need guidance from a legal professional as soon as possible. These fights can result in time-intensive and costly legal battles, and the sooner you get legal advice, the better chance you have of avoiding this.

Complicated beneficiary plans

Some wills have complicated beneficiary designations leaving assets to one child and nothing to another. Others could include charitable bequests or leaving assets to many beneficiaries.

Shweta Lawande, a financial adviser at Francis Financial specializing in working with widows, shares an example of a complicated beneficiary plan one of her clients had to muddle through. “We have one client: a lovely 94-year-old mother of three children, grandmother of 12 grandchildren, and great-grandmother of 14 great-grandchildren. When her husband died earlier this year, she inherited most of the estate. However, her husband was committed to leaving a gift at his death to all of his surviving heirs. We have introduced Sandy to a fantastic estate planning lawyer to ensure all assets are appropriately distributed as there are 30 beneficiaries.”

Finding the right estate planning lawyer

It’s good to hire an accredited lawyer in your area whose primary focus is estate and trust law. Finding the right attorney may sound intimidating, but it doesn’t have to be complicated.

Your financial planner will likely have many trusted relationships with estate planning lawyers, and they can introduce you to a professional in your area.

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Stacy Francis, CFP®, CDFA®, CES™
President & CEO, Francis Financial Inc.

Stacy is a nationally recognized financial expert and the President and CEO of Francis Financial Inc. (opens in new tab), which she founded 15 years ago. She is a Certified Financial Planner® (CFP®) and Certified Divorce Financial Analyst® (CDFA®) who provides advice to women going through transitions, such as divorce, widowhood and sudden wealth. She is also the founder of Savvy Ladies™, a nonprofit that has provided free personal finance education and resources to over 15,000 women.