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The CPA's Role in Estate Planning 

Published October 22, 2004

Scope of Services

Identifying Goals

Reviewing the Current Situation

Developing Estate Planning Strategies

Planning for Transfers at Death

Coordinating the Estate Planning Team 

Implementing and Monitoring

Ancillary Matters

Scope of Services  

In providing estate planning services, you provide services far beyond straightforward financial analyses. This planning area requires a special sensitivity to the dynamics of the client's entire life—family, finances, business, lifestyle, and goals. Your role can be summarized as working with your clients to identify and clarify their goals, explain projected tax and other consequences, and recommend alternative strategies.

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Identifying Goals

Your role is to help your client identify and clarify their estate planning goals. Most individuals have goals that center on preserving and directing the disposition of their assets, while reducing the potential estate tax liability and providing for adequate liquidity. During this process, you will often be helping your client to come to terms with the prospect of death before goal setting can begin. 

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Reviewing the Current Situation

Your role here is multifaceted and includes such activities as:

  • Analyzing the client's current financial situation
  • Gaining knowledge of the client's nonfinancial situation (family, business, etc.)
  • Identifying any anticipated assets (remainder interests, life insurance proceeds, potential inheritances, etc.)
  • Determining estate liquidity needs
  • Reviewing asset titling
  • Reviewing relevant documents (existing wills, trusts, insurance policies, retirement plans, etc.)

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Developing Estate Planning Strategies

After reviewing a client's goals, assets, liquidity, legal documents, and other aspects of the client's life, your role is to develop and evaluate alternative strategies that, based on available resources and other constraints, are designed to fulfill the estate planning goals. Key aspects in this area include: analyses of the income and estate tax implications of existing arrangements and proposed strategies; the verification that proposed strategies will meet specific goals; and the balancing of different and competing financial goals.

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Planning for Transfers at Death

Where appropriate, and without violating prohibitions against the unauthorized practice of law, you may discuss with your clients and help them evaluate how transfers of their property will occur—by will, by operation of law, by other contract, or the laws of intestacy. You can also review current wills or work with attorneys to determine that your clients' wishes are reflected in new wills being prepared.

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Coordinating the Estate Planning Team  

An important part of your role is working with the various members of the estate planning team—attorneys, insurance brokers, investment professionals, actuaries, appraisers, etc.—to ensure proper implementation of the strategies developed and to assure that all important concepts are included in the overall plan.

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Implementing and Monitoring

 

You will often advise your clients on implementation of your various recommendations, including the coordination of such activities as the selection of an attorney to draft documents; the transfer or retitling of assets; gifting programs; and purchase of insurance. In addition, it is important to monitor changes in your client's family, health, business, and other life situations on an ongoing basis to assess the continuing validity of the estate plan.

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Ancillary Matters

Depending on your relationship with your clients, you may be asked to advise them in the selection of executors, guardians, trustees, and other fiduciaries appointed during the estate planning process or to discuss the importance of advance directives, such as powers of attorney, living wills, and health care proxies.

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