A piece of paper that reads “Estate Planning” with a pen and glasses on top of it in Birmingham.

Why is a CPA Important in My Estate Planning

Estate planning is the process of arranging for the distribution of an individual’s assets and wealth upon their death. Ideally, estate planning in Birmingham, AL is a coordinated effort of a team of professionals such as CPAs, attorneys, and investment advisors.

The Key Components

While specific components can vary based on your circumstances, it’s important to understand the basic parts of an estate plan. The primary components include:

  • Will
  • Trusts
  • Power of Attorney
  • Healthcare Directive
  • Beneficiary Selections

Laying out your desires clarifies the direction of your hard-earned assets after your death. 

If you do not have a plan in place, a court will determine how to distribute your assets. Avoiding probate can ease the stress on your family and allow them to grieve your death instead of being tied up with complicated issues.

The Timing

When is the best time to start estate planning in Birmingham, AL? Here are some factors to consider when deciding when to begin.

  • Age: We cannot always foresee what the future has in store. Starting the foundation of your estate plan in your 20s or 30s can ensure that you are ready for any unanticipated events.
  • Assets: Accumulating significant assets means beginning your plan as soon as possible. It’s key to have an arrangement in place to reduce estate taxes and any tax debt.
  • Dependents: With minor children, it’s vital to choose guardians, create a trust to manage assets for their benefit, and plan for their care in case of incapacitation or death.
  • Health: A unexpected diagnosis or on-going poor health should prompt you to organize your end-of-life care, healthcare proxy, and living will.

Find resources on our website that explain additional factors of estate planning in Birmingham.

The CPA’s Important Role

Thanks to an intricate knowledge of taxes, a Birmingham CPA will be able to tell you the tax implications of every decision you make. CPAs are vital to the planning process in a number of other ways.  

Minimize Taxes, Maximize Assets

The goal of estate planning is to maximize the number of assets that can be transferred to heirs while minimizing the amount of estate taxes that must be paid. Work with a CPA to lessen your tax liability.

Plan for the Future

Even those without a sizeable estate could now find their estate becomes very significant by the time they die. A Birmingham CPA can give you reasonable future expectations of your estate value. Thanks to these predictions, you can make informed decisions now and when you make modifications to your estate plan in the future.

Trust a Fiduciary 

CPAs are trusted advisors and often asked to serve as fiduciaries (those who manage for your benefit, not theirs) for clients and family members. When a family member is named as executor, it’s often a confusing role. A trusted Birmingham CPA can be a valuable adviser to those with no prior experience with estate and trust administration.

We believe that estate planning, like our other services, requires a foundation of trust, integrity, and accountability to be successful. It is important to have a plan in place. If you haven’t started estate planning yet or need to refresh your plan, contact us online or call (205) 402-4245 to get started today.


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