You can run Estate Planning as a stand-alone report; however, most planners run it as part of a comprehensive plan. In the latter option, MasterPlan projects all the clients assets and liabilities to the year of the first death.
The Estate Planning Worksheet contains two tabs:
The Property Ownership and Gross Estate Worksheet
The Estimated Federal Estate Tax Worksheet.
These worksheets are interactive, that is, you can make edit any of the data entry cells displayed with a white background. MasterPlan automatically recalculates all affected fields to reflect the new information, and displays these in grayed-out cells.
Once you have completed the two worksheets, you can select one or all of the four reports. The first two reports retain the same information in the same format as the worksheets. The third report is an analysis of Cost and Liquidity, and the fourth is the explanatory text report. You can also create several graphs.
You need to fill out the vital information (such as the names and birthdates) on the Clients and Projection Assumptions Tabs on the Client window. Although MasterPlan asks for the life expectancy on the Clients Tab, you can enter any year of death you choose from the current year out to the final year of the planning horizon when you run the report.
If you want MasterPlan to project each asset and liability out to the year of death, enter them on the database. Or, if you want to run this report as a stand-alone, fill out all the information on the worksheet itself.
Now click on Reports | Worksheets | Estate Planning.
MasterPlan displays the MasterPlan Report Setup Screen. From this screen, you need to select
The survivor
The year of the first death
The year of death for the first to die
You also need to determine if you want to run this as a stand-alone module without bringing any of the totals in from the database.
If you enter a year beyond the life expectancy of the clients, you may get a message telling you that you have a "Range Check Error."
Integrated Report: If you enter a year within the clients' life expectancies, MasterPlan will project the assets and liabilities to that year and display them on the worksheet.
Stand-Alone Report: If you check the Stand-Alone Box, MasterPlan will ignore all assets and liabilities, and the worksheets will have all zeros. It will then ask you for the year of the first death.
If you have chosen to use a very large resolution with large fonts on your screen, you may not be able to see the entire worksheet. You may find it helpful to maximize the worksheet.
Remember to check the message center and to press the F1 Help key for additional help.
Since this is a worksheet, you may adjust the amounts in any way that you wish. For example, if you want to illustrate what will be left in the estate if the clients give away a certain chunk of the estate that is currently contained in their portfolio, you may adjust the totals downward to reflect that gift. MasterPlan will not reflect those changes back on the database from this window.
If you plan to save this worksheet and restore it later, you may use the Notes to indicate your assumptions.
Notice that the projected amounts and calculated totals are divided into five columns:
Joint
Community
First to Die
Second to Die
Totals
For both joint and community property, MasterPlan divides the figure in half. If you override the projected amounts by typing in new figures, MasterPlan reflects those new amounts in the calculated totals.
As soon as you are satisfied with the Property Ownership Tab, click on the Estimated Federal Estate Tax Tab.
The following four buttons are displayed at the bottom of the worksheet window.
You may save only one version of this worksheet for a client household. You may click on the Save button as many times as you wish while working on this worksheet.
The saved values will be available to you the next time you enter the worksheet.
Clicking on the Save button will not save the calculated estimated estate tax to the client record, however. At the time you exit the worksheet, MasterPlan asks if you want to save those values.
Each time you close the worksheet and then select it again from the Reports | Worksheets Menu, MasterPlan recalculates all information.
You can retrieve the previously saved version of this worksheet either to continue working on it, or to reconstruct and reprint the reports. To do so, you must click, on the Restore button after the worksheet is displayed. MasterPlan will replace the newly calculated figures with the saved version.
Click on this button to select one of the four estate reports or one of the graphs described below.
Be sure to click on the Save button before you click on the Close button, if you want to retrieve this worksheet later.
To exit, click on the Close button.
At this point, MasterPlan asks if you want to save the calculated estimated federal estate tax to the client record.
If you click on Yes, you will be able to view these figures on the EditClient | Clients Tab.
MasterPlan will display the calculated estate taxes for the non-survivor on the Capital Needs Analysis worksheet if you have saved this figure. However, on the worksheet, you may zero this figure out.
Many planners adjust the column for the first client to die, and then begin again at the top of the column for the second client to die.
Since the resolution of some computer monitors prevents MasterPlan from displaying the entire window, we repeat the totals from the bottom of the left-hand side of the window for Taxable Estate again at the top of the right-hand side of the window.
Notice that at the top left-hand corner of the data entry section, MasterPlan displays the same year of death for both clients. If you want to illustrate a later year of death for the second to die, type it in.