COVID-19 has caused us all to rethink many things that we generally take for granted, including how to best serve our trusts and estates clients. Whether you have a client seeking sound judgement, help with establishing or revising an estate plan, advice with respect to wealth transfer planning, pro bono help, or simply someone to talk to, below are five practical steps you can take to help ensure that you remain in the best position to be responsive to your clients’ needs.
1. Reach Out. COVID-19 has created an opportunity to strengthen and deepen client relationships in unprecedented ways. Use this time to reach out to your clients and their co-advisors to suggest relevant planning ideas, inform them of any new rules affecting them and simply check-in on their wellbeing.
2. Review Basic Estate Plans. Offer to review estate plans to determine whether or not they accurately reflect the client’s current wishes, particularly if they have not been updated recently. Pay special attention to clients who are ill or elderly as well as clients who are risking their lives on the front lines of the medical system or have family members who are. Additionally, encourage clients to review their beneficiary designations for retirement assets. While beyond the scope of this article, in certain cases it may be prudent to engage in pre-mortem estate planning, such as funding existing revocable trusts to avoid dealing with closed and/or backlogged court systems (although opening a revocable trust account may be more difficult now than it would be usually) and prefunding funeral arrangements.
3. Stay Informed of Changes in the Law. Keeping abreast of changes in the law will help you serve your clients’ needs as well as be another reason to reach out to them. Here are some examples of recent changes that may be relevant to your clients:
• The Families First Coronavirus Relief Act. The Families First Act was enacted on March 18, 2020, and requires certain employers to enact or expand paid medical leave for reasons connected to COVID-19.
• The CARES Act. The CARES Act was enacted on March 27, 2020, and includes several relevant provisions, including expanded unemployment benefits, suspending limitations on charitable deductions for cash contributions to public charities, and emergency grants and loan forgiveness for some small businesses.
• Remote Notorization Acts. Many states have enacted remote notarization rules to help maintain social distancing efforts, greatly facilitating document execution.
• Federal and State Tax Filing Extensions. Federal income, gift and generation-skipping transfer tax filing and payment deadlines have been automatically extended for all taxpayers until July 15, 2020. Additionally, many states, including New York and California, have automatically extended the deadlines for state income tax filing and payment until July 15, 2020.
4. Capitalize on the Current Economic Environment. Valuations and interest rates are at historic lows. Accordingly, this may be the perfect time to advise your clients to consider one or more of the following techniques:
• Leverage gift tax exemption use and/or minimize gift taxes by gifting undervalued assets with appreciation potential, either outright or in trust.