Crafting Your Legacy: Essential Estate Planning Tips for Xerox Holdings Employees

Healthcare Provider Update: Healthcare Provider for Xerox Holdings Xerox Holdings provides its employees with access to health insurance plans primarily through a partnership with major national insurers. Prominent health insurance providers include UnitedHealthcare, Anthem, and others, depending on the specific plan and state location. Employees are encouraged to review their options during open enrollment to choose the plan that best suits their healthcare needs. Projected Healthcare Cost Increases in 2026 The landscape for health insurance premiums in 2026 is disconcerting, especially for Xerox Holdings employees relying on plans from the Affordable Care Act (ACA) marketplace. In many states, premium increases could surpass 60%, primarily due to the anticipated expiration of enhanced federal premium subsidies, rising medical costs, and aggressive rate hikes from insurers. Consequently, individuals enrolled may see their out-of-pocket costs rise dramatically, with estimates suggesting an overall increase in premiums by as much as 75% for nearly 92% of marketplace enrollees. This combination of factors makes proactive financial planning essential for employees to navigate the upcoming challenges in healthcare expenditures effectively. Click here to learn more

Benefits of a will:

•  Distributes property  according to your  wishes
•  Names an executor to  settle your estate
•  Names a guardian for  minor children 
• Can create a trust

You've worked hard with Xerox Holdings over the years to accumulate wealth, and you probably find it comforting to know that after your death the assets you leave behind will continue to be a source of support for your family, friends, and the causes that are important to you. However, we'd like to remind our clients from Xerox Holdings that to ensure your legacy reaches your heirs as you intend, you must make the proper arrangements now. There are four basic ways to leave a legacy: (1) by will, (2) by trust, (3) by beneficiary designation, and (4) by joint ownership arrangements.

Wills

A will is the cornerstone of any estate plan. We suggest that our Xerox Holdings clients have a will no matter how much their estate is worth, even if they've implemented other estate planning strategies. You can leave the property by will in two ways: making specific bequests and making general bequests. A specific bequest directs a particular piece of property to a particular person ('I leave Aunt Martha's diamond broach to my niece, Jen'). A general bequest is typically a percentage of property or property that is left over after all specific bequests have been made.

Typically, principal heirs receive general bequests ('I leave all the rest of my property to my wife, Jane'). With a will, you can generally leave any type of property to whomever you wish, with some exceptions, including:

• Property will pass according to a beneficiary designation even if you name a different beneficiary for the same property in your will
• Property owned jointly with rights of survivorship passes directly to the joint owner
• Property in a trust passes according to the terms of the trust
• Your surviving spouse has a right to a statutory share (e.g., 50%) of your property, regardless of what you leave him or her in your will
• Children may have inheritance rights in certain states

Caution:  Leaving property outright to minor children is problematic. You should name a custodian or property guardian, or use a trust.

Trusts

Another option we'd like to point out to our Xerox Holdings employees is to leave property to their heirs using a trust. Trust property passes directly to the trust beneficiaries according to the trust terms. There are two basic types of trusts: (1) living or revocable, and (2) irrevocable. Living trusts are very flexible because you can change the terms of the trust (e.g., rename beneficiaries) and the property in the trust at any time. You can even change your mind by taking your property back and ending the trust.

An irrevocable trust, on the other hand, can only be changed or ended by its terms. This can be useful for our Xerox Holdings clients who want to minimize estate taxes or protect their property from potential creditors. You create a trust by executing a document called a trust agreement (we suggest these Xerox Holdings clients have an attorney draft any type of trust to be sure it accomplishes what they want).

A trust can't distribute property it does not own, so you must also transfer ownership of your property to the name of the trust. Properties without ownership documentation (e.g., jewelry, tools, furniture) are transferred to a trust by listing the items on a trust schedule. Property with ownership documents must be re-titled or re-registered. You must also name a trustee to administer the trust and manage the trust property. With a living trust, you can name yourself trustee, but you'll need to name a successor trustee who'll transfer the property to your heirs after your death.

Tip:  A living trust is also a good way to protect your property in case you become incapacitated.

 

While property that  passes by will is subject

to probate, property that  passes by a trust,

beneficiary designation,  or joint ownership

arrangement bypasses  probate.

 

Beneficiary Designations

Property that is contractual in nature, such as life insurance, annuities, and retirement accounts, passes to heirs by beneficiary designation. Typically, all you have to do is fill out a form and sign it. Beneficiaries can be persons or entities, such as a charity or a trust, and you can name multiple beneficiaries to share the proceeds. You should name primary and contingent beneficiaries.

Caution:  You shouldn't name minor children as beneficiaries. You can, however, name a guardian to receive the proceeds for the benefit of the minor child.

We suggest that these Xerox Holdings clients consider the income and estate tax ramifications for their heirs and their estate when naming a beneficiary. For example, proceeds your beneficiaries receive from life insurance are generally not subject to income tax, while your beneficiaries will have to pay income tax on proceeds received from tax-deferred retirement plans (e.g., traditional IRAs).

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These Xerox Holdings clients should check with a financial planning professional to determine whether their beneficiary designations will have the desired results. Be sure to re-evaluate your beneficiary designations when your circumstances change (e.g., marriage, divorce, death of beneficiary). You can't change the beneficiary with your will or a trust. You must fill out and sign a new beneficiary designation form.

Caution:  Some beneficiaries can't be changed. For example, a divorce decree may stipulate that an ex-spouse will receive the proceeds.

Tip:  Certain bank accounts and investments also allow you to name someone to receive the asset at your death.

Joint Ownership Arrangements

Two (or more) persons can own property equally, and at the death of one, the other becomes the sole owner. This type of ownership is called joint tenancy with rights of survivorship (JTWRS). A JTWRS arrangement between spouses is known as tenancy by the entirety in certain states, and a handful of states have a form of joint ownership known as community property.

Caution:  There is another type of joint ownership called tenancy in common where there is no right of survivorship. Property held as tenancy in common will not pass to a joint owner automatically, although you can leave your interest in the property to your heirs in your will.

You may find joint ownership arrangements are useful and convenient with some types of property, but may not be desirable with all of your property. For example, having a joint checking account ensures that, upon your death, an heir will have immediate access to needed cash. And owning an out-of-state residence jointly (e.g., a vacation home) can avoid an ancillary probate process in that state. But it may not be practical to own property jointly where frequent transactions are involved (e.g., your investment portfolio or business assets) because you may need the joint owner's approval and signature for each transaction.

There are some other disadvantages to joint ownership arrangements, including: (1) your co-owner has immediate access to your property, (2) naming someone who is not your spouse as co-owner may trigger gift tax consequences, and (3) if the co-owner has debt problems, creditors may go after the co-owner's share.

Caution:  Unlike with most other types of property, a co-owner of your checking or savings account can withdraw the entire balance without your knowledge or consent.