As the new year approaches, it is a good time to review and update — or create — an estate plan. When you are doing so, be careful to avoid or eliminate common mistakes that could cost your heirs extra time, money and/or aggravation. Here are 10 of the most common mistakes…

Mistake 1: Your plan assumed the $3.5 million exemption was forever. There often are legal ways to reduce or avoid estate taxes — but if your estate was drafted more than two years ago and was worth significantly less than $3.5 million, your attorney might not have bothered with these.

What to do: If your estate is worth between $1 million and $3.5 million, ask your attorney to confirm that your estate plan is flexible enough to minimize taxes whatever the eventual size of the estate tax exemption. If you are married, confirm that under your estate plan, your combined estate tax exemption does not diminish when the first spouse dies and his/her assets pass to the other spouse.

Mistake 2: You used the wrong procedure for signing your will. Each state has its own detailed rules about the proper procedure for signing, or “executing,” a will. If any of these rules are violated, a court might not accept the will as valid.

Execution mistakes are most common when people draft their own wills, but they also occur when attorneys who do not specialize in estate planning draft wills… when attorneys mail wills to homebound clients to be signed… and when people make changes to wills without their attorneys’ knowledge to avoid extra lawyer fees. In many states, witnesses must hear the signer of the will state that this is his/her will, not just view the signing.

What to do: Sign or modify your will in the presence of an experienced attorney who specializes in estate planning… or make sure that you have extensive knowledge of the rules.

Mistake 3: You provide excessive detail about personal property. Going into exhaustive detail in your will about who gets what might seem like a good way to avoid confusion or arguments among your heirs, but the truth is, it’s likely to make things worse.

Unless you update your will every time you acquire or dispose of a possession, your will’s list of items will differ from what you actually own. Such disparities tend to create confusion and trigger arguments among heirs. Extreme detail in a will also can attract unwelcome attention from the IRS.

Example: A wealthy man’s will listed a boat that he had sold years before. An IRS agent refused to believe that this boat had been sold until the heirs produced an affidavit from the buyer attesting to the transaction.

What to do: Rather than list your possessions in detail, simply write “my tangible personal property” and provide an outline for how heirs should divvy it up. For instance, your children can take turns selecting from your personal possessions. Make note of particular possessions only when you feel it is important to make a specific bequest.

Mistake 4: You fail to put tangible personal property into revocable living trusts. Revocable living trusts let estates avoid the costs and delays of the court process called probate — but they work only if the title to the property actually is transferred to the trust. Attorneys typically help clients transfer titles to financial assets and real estate when these trusts are set up, but personal possessions, such as vehicles, jewelry, art and furniture, often are overlooked.

What to do: If you have a revocable living trust, ask your attorney whether your tangible personal property is listed in it. If not, ask the attorney for instructions on how to put it in.

Mistake 5: You fail to confirm how real estate is titled. Your careful estate planning could be completely derailed if your attorney misunderstands how your real estate is titled.

Example: A woman’s estate plan included a credit shelter trust intended to shield her valuable Manhattan real estate from estate taxes. Her attorney did not realize that her husband was listed as a joint owner on the title. Joint ownership meant that the property passed directly to the husband upon the woman’s death, rendering the trust irrelevant — and eventually saddling the family with a fortune in taxes that could have been avoided.

What to do: Make absolutely sure that all of your real estate is titled correctly.

Mistake 6: You fail to arrange for someone to take care of your home(s) after you pass away. Vacant houses can result in expensive problems. Vandals might break in… storms might shatter windows… pipes might freeze and burst.

What to do: If no one will be living in your home immediately after your death, specifically ask one of your heirs or a trusted neighbor to look after the property. Identify this caretaker in your will so that the executor does not block this person’s access to the home. If no one is available, instruct the executor of your estate to hire a caretaker.

Mistake 7: You fail to take the steps necessary to allow a dependent or friend to continue living in your home. The executor of the will generally has a legal duty to sell the deceased’s home as quickly as possible after its owner’s death, assuming that there’s no surviving joint owner. Anyone living in the home likely will be evicted — even if it’s someone the deceased would not have wanted kicked out. That’s particularly problematic these days, since many adult children have lost their jobs in this economy and have been forced to move back in with their parents.

What to do: Include a clause in your will specifying who is allowed to live in your home following your death, the period of time that this person is permitted to live there and the amount of rent, if any, that should be charged.

Mistake 8: You accidentally disinherit stepchildren. Many wills simply divide assets evenly among descendants. Stepchildren are not considered descendants by the law, however, unless they have been legally adopted.

What to do: If you have stepchildren and want them to share in your estate, make sure that your attorney knows about your stepchildren. If you draft your will yourself, list each child and stepchild by name, rather than simply writing “my descendants” or “my children.”

Mistake 9: You make a minor change to a will by adding a codicil. Codicils (supplements to a will that do not require rewriting the will) are vestiges of the precomputer days when it was time-consuming and expensive to make minor changes to the will itself. Today, making minor adjustments to a will usually is much cheaper and easier than adding a codicil.

Adjusting the will itself also provides added privacy. If you have a falling-out with a friend or relative and use a codicil to remove this person as a beneficiary or executor, both the original will and the codicil will be in the public record, available for anyone to see.

Example: Rock Hudson removed a friend named Tom Clark from his will prior to Hudson’s death in 1985 and presumably did not want that change to be publicly known. Yet the breakdown of that intimate relationship is well- known today because Hudson used a codicil to make this change.

What to do: Before agreeing to add a codicil, ask your attorney whether it would cost you less to make a change by updating the will itself. Also, lean toward the update if privacy is an issue.

Mistake 10: You remove the staple from a will. The seemingly harmless act of pulling out the staple that binds the pages of your will, perhaps to make a photocopy, could cause major headaches for your heirs. If someone contests your will, he/she could argue that the extra staple holes are evidence that a page was removed or replaced.

What to do: If you make a copy of your will, do so by folding pages back, not separating the pages.

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