Monday, October 30, 2017

Navigating the Many Estate Planning Hurdles that Can Lay Along Your Path

Summary: Estate planning law, like most types of law, contains many details, specifics and requirements. This is especially true of probate law. If you are considering creating an estate plan, it is important to work with experienced legal counsel who can make sure your plan meets all the law’s obligations. Additionally, certain types of plans, such as plans built around living trusts, may prove greater freedom in naming the people you want to carry out your wishes after you’ve passed. 

If you work in the pharmaceutical and medical device industry, you are required to follow a specific set of industry-standard rules for carrying out your work. The law is somewhat like that, with its own set of detailed rules and standards that absolutely must be followed. The difference is, of course, that the law (and the need for compliance with its obligations) is far more likely to have an impact on more us and our everyday lives than the rules of good practice for pharmaceutical and medical device manufacturing.

Probate law is definitely one area where that’s true. Do you know how many witnesses the law in your state requires for a last will and testament to be valid and probatable? In most places, it is two, but did you know that in some states it is three? Do you know whether the law in your state allows someone who isn’t a resident of your state to be an executor of a probate estate? In Florida, for example, most non-residents are NOT eligible to be executors; only the decedent’s spouse and certain close relatives are allowed be executors without being Florida residents.

Here is another question: if you hand-write your will, can it be submitted and probated after you die? If you live in Texas, and you compose a hand-written (technically known as “holographic”) will entirely in your own handwriting – and you sign it – it’s probably valid, even if you wrote it on the back of an envelope. In Florida, though, holographic wills are generally invalid.

So, what is the point of all of these questions about all of these legal rules? Well, there are two points, actually. One is a reminder of just how many rules and details are involved in creating a proper estate plan that clear all of the hurdles that the law establishes. To make sure that your plan dots all the legal I’s and crosses all the legal T’s, make sure that you are working with a knowledgeable and experienced lawyer who knows how to take your desires and goals for your legacy and put them into valid, enforceable legal documents.

The second, and at least as important, point is a reminder of just how intricate an estate built around a will (and probate) can be. There are lots of potential hurdles. One way to avoid some of these potential hurdles is through the use of a revocable living trust. As an example, several states (as noted above) create restrictions on who may serve as an executor of a probate estate. Some of those limitations are substantial. On the other hand, most all states have relatively few limits on who may serve as a successor trustee of a living trust. Depending on where you live, you may have much more freedom, with a living trust-based plan as opposed to a will-based plan, in naming the person you want to oversee the distribution of your assets after you’re passed.
    
 This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


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8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
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Thursday, October 26, 2017

Incorporating Both Your Children With -- and Without -- Special Needs into Your Estate Plan Asset Distribution

Summary: Estate planning is very important if you’re a parent of minor children. It is still extremely vital even after all your children pass their 18th birthdays, especially if you have a child or children with special needs. With careful and detailed planning, you can feel confident that you’ve done all you can to provide fully and fairly for all your kids, and that you’ve done all you can protect your child with special needs from a loss of vital benefits as a result of an improper direct receipt of an inheritance.

If you are a parent, especially if you’re the parent of more than one child, chances are you very familiar with having heard, “That’s not fair!” There are many situations in which you may have heard that familiar refrain, but definitely one circumstance is when a child thinks she has received an insufficiently large share of something as opposed to their siblings. Even in estate planning, many parents strive to ensure that they play “fair,” working to create a plan that leaves an equal amount of wealth to each of their children.

This is an understandable, and even noble, goal. If, however, you have among your children some with special needs and some without, then achieving this objective can be substantially more complicated, and can sometimes lead you into bad decisions if you do not plan carefully.

Many parents of children with special needs are familiar with the legal concept of a “special needs trust” (sometimes alternately known as a “supplemental needs trust (SNT).”) If your child with special needs receives need-based governmental benefits, then it is important to ensure that any inheritance you leave for that child does not transfer directly into her name (and cause her to lose eligibility for her needed benefits.) The SNT is a way to do that.

So, if you have two children (one with special needs and one without,) then dividing your assets could be as simple as splitting your assets between your child without special needs and the SNT of your child with special needs, right? Possibly, but proper planning may still be complicated than that. The optimal way to plan to leave a legacy for your children, and leave them the largest one possible, may depend on what type of assets you possess. For example, assume that you own a traditional IRA. Leaving that asset to your special needs child’s SNT could trigger a much higher tax bill than leaving it to your child without special needs. On the other hand, there are other assets, like non-retirement CDs, that may be able to provide a benefit to your child with special needs without causing such a damaging tax ramification. Therefore, maximizing your distributions to your kids may involve leaving all of one asset to one child and all of another to another’s SNT, as opposed to giving 50% of each asset to each side.

Ultimately, the keys are to make sure that you get that SNT put into effect and that you ensure that whatever assets you desire to go to into it are funded in the proper fashion. Additionally, just like with any asset with a death beneficiary designation, take care to give your retirement assets, along with your entire estate plan, periodic “check-ups” to make sure that your estate plan documents and your asset beneficiary designation paperwork remain “in synch” and optimized to carry out your goals exactly in the manner you want. 

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan


Monday, October 23, 2017

Alan Thicke | More Lessons from Another Celebrity Estate Plan and its Problems

Summary: There can be a lot the general public can learn from the news reports of celebrities’ estates and estate planning. Recent reports related to the estate of actor Alan Thicke offer quite a bit of useful instruction. Getting a plan not only to protect your goals regarding your assets but also your children is extremely important, but so is making sure that all of your estate planning and estate planning-related legal documents have matching or consistent terms, to ensure that they form one unambiguous singular set of instructions regarding your legacy.  

Alan Thicke was a skilled professional who earned credits as songwriter, talk show host and game show host. He is, of course, best known as a actor, especially for his role as a beloved TV dad on the 1980s sitcom Growing Pains. During his career, Thicke achieved considerable success and wealth.

In 2000, three years after his third and youngest son was born, Thicke created a living trust. The birth of a new child can be an excellent time to set up a complete estate plan if you don’t already have one. The desire to provide for your (newly enlarged) family can be an excellent motivator to overcome procrastination and get your affairs in order.

This can be especially true if when it comes to your littlest ones. Your will can allow you to name the person you want to serve as your minor child’s guardian if something happens to you and your child’s other parent. In Thicke’s case, according to a TMZ report, he drafted a will that named his brother as the guardian for Carter if both he and Carter’s mother died before the boy reached age 18.

Among the trust’s other provisions, that document dictated that his sons would receive their father’s ranch in Carpenteria, Cal., splitting equally among the three of them. According to a report in the entertainment trade publication Variety, Thicke’s plan may have had a problem. Before he married his third wife in 2005, he and his future bride created a prenuptial agreement. Prenuptial agreements can be beneficial contracts for some couples and they can be useful complements to an estate plan.

Of course, the key is to make sure that, to the extent that your prenup and your estate plan address the same property, that they are “on the same page” and are in agreement and work together in a consistent and non-contradictory way.

According to Thicke’s wife, that didn’t happen in his case. The prenup, she contended in her legal challenge to the living trust, stated that she was to receive five acres from the Carpenteria ranch. (The trust said she got nothing from that ranch other than the right to live there during her lifetime so long as she paid for all of the upkeep on the property, including the mortgage payments.)

So where did that leave this family? In court, with the sons filing a legal action in Los Angeles County Superior Court to enforce the terms of the living trust. They claimed in their court action that that the wife “claims that Alan repeatedly promised to leave the Ranch to her.”

So what can the rest of us learn from this unfortunate circumstance? Several things. Alan Thicke appears to have done some estate planning things well. He created a living trust to express his goals and preferences. He also created a will to make sure that he had named a guardian for his very young son.

His plan may also have had some problems. The information provided in the Variety report seems to raise the possibility that the living trust and Thicke’s prenuptial agreement he signed with his third wife may been fundamentally in conflict regarding the distribution of the Carpenteria ranch.

So, what can you do for your family? First, make sure that, when you get your affairs in order, they’re really in order. Make certain that all of your documents, including your living trust, your will, your beneficiary deeds, your pay-on-death accounts, your other non-probate transfers and your prenuptial agreement all are “in synch” to form one consistent narrative regarding your set of objectives. Second, make sure that you communicate. Sitting down with all of your family to explain carefully all of your desires for your legacy can sometimes minimize or eliminate conflict between family members, and may help avoid court challenges.

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan





Thursday, October 19, 2017

Don’t Forget Your Final Arrangements When Making Your Estate Plan

Summary: Many people, when they think about planning their estates, think that means dividing their wealth among their loved ones and/or favorite charities. This is one of the most important things that your estate plan will do, but it doesn’t have to be the only thing. A comprehensive plan can help you to make sure that your loved ones are protected in another way, as comprehensive planning can give your loved ones needed liquidity in order to pay the final expenses that your estate will owe.

Planning for the resolution of your final affairs and expenses should have two components to it. On one side, you can take a lot of the guesswork out of the final arrangements process, and give your loved ones peace-of-mind, by creating as part of your estate plan a written record of your preferences and desires regarding your funeral. Do you want to be cremated? Do you want to be buried somewhere and, if so, where? Do you want a funeral and, if you do, whom do you want to speak and what music would you like to play? These are but some of the pieces of important information you can impart in the funeral planning portion of your plan. The more details you can give your loved ones, the less guesswork they’ll have. Some states even have recognized legal documents that you can create (with names like “Funeral Planning Directive”) where you can state all of your intentions and desires about you funeral and related arrangements.

You also should plan for dealing with final financial matters. Many people overlook this aspect and may not have enough cash flow at their death, leaving problems for their loved ones when it comes to paying bills. Even if you don’t owe federal estate taxes upon your death, there will still be bills, whether they are final medical bills or just other debts you owe. Your successor trustee of your living trust or the executor of your estate will have to pay for the taxes, utilities and upkeep on your home. If you have any dependents, your estate or trust will have to pay for their needs. Additionally, there’s also your funeral itself.

There are several ways to make sure that you’ve planned to create the liquidity your loved ones will need. Life insurance can be a very useful part of your estate planning in this regard. Proper planning with life insurance can mean that your loved ones will have the money they need to pay bills, pay taxes and maintain upkeep on your assets requiring maintenance.

Another way to plan to ensure liquidity is through another form of insurance to deal with funeral and final expenses. These funeral and final expense costs can be substantial and, for many people, their estate may not have the liquid assets to deal with them readily. Insurance products like final expense insurance or irrevocable funeral trusts can give you peace-of-mind when it comes to knowing that there will be funds to deal with these costs. Many funeral trust products are “guaranteed issue” with “no underwriting,” which means that you can obtain these products regardless of your health and count on those funds being there when your family needs them.

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan






Monday, October 16, 2017

Planning Your Estate When You Have No Living, Spouse Children or Close Heirs

Summary: The world is full of billions of people with a full spectrum of familial relationships. Some have large families. Others have none or have small ones whom they’ve outlived. If you’re in a situation where you have no living spouse or close blood relatives, your circumstance dictates that you definitely should look at getting an estate plan in place. The state laws for people like you may, if have no plan, send all of your wealth to a distant relative you don’t even know personally. With a plan, you can make certain that those whom matter the most you will be the ones to benefit from your legacy.  

Almost all of us have reasons for needing to plan our estates, with aspects of our lives that make taking control of our legacies both important and desirable. Maybe we want to ensure financial security for our children, grandchildren and their descendants. Maybe we need to make certain that a child with special needs continues to be provided for. There are many purposes related to spouses or immediately family that drive many of us.

However, what if you have no surviving spouse, or children, or siblings or parents? What if you have no close living relatives at all? Is it true that you no longer need to worry about planning your estate? Absolutely not! In fact, the opposite is often true.

In many cases, people who never marry and never have children may be able amass greater savings due to the absence of a need to spend wealth on kids, who can tend to be expensive. Many of these people, then, may have substantial wealth while at the same time having strong desires and goals for what happens to that wealth after their deaths. Maybe you want to recognize a platonic friend. Maybe you have a favorite charity. Regardless of the destination, chances are that you have a preferred one, and that is why, for you as a person with no close legal relatives, estate planning is extraordinarily important.

If you are a person with no close living relatives or spouse, do you know what happens to your wealth after you die if you have no valid estate plan in place? The answer is: the same thing that happens to everyone else’s estates when they have no plans… intestacy. Intestacy means that your wealth is distributed according to a pre-set system established by the statutes of the state where you legally reside. Generally, this means that whomever is entrusted with distributing your wealth will be charged with finding your closest living relative(s) and giving your assets to them. If you have no living spouse, children, siblings or parents, the system will continue expanding across your family tree, in search of cousins, aunts/uncles, grandparents and so forth.

Eventually, if there’s no living person within a certain degree of blood relation, your assets distribute to the state treasury of the state where your reside. In other words, if you do not set up a plan, your assets could easily end up going, after you die, to a grand-niece/nephew or first-cousin-twice-removed whom you may have never met!   

So, how do you avoid this? Get a plan, and get started right away. With a proper and complete estate plan in place, you can take total control of your legacy and make sure that your wealth goes to the people and/or institutions that you want to receive them. Trust planning can be an integral part of your estate planning as a person with no spouse or close living relatives. Maybe you have a beloved pet or pets in your life whose care you want to ensure and provide for after you’re gone. With a complete estate plan that includes a pet trust, you can make certain that you’re in control of indicating whom you want to care for your beloved “fur-baby” after your death, and you can make sure that that person has the financial resources to provide that proper care.

Alternately, perhaps you have a charity whose mission is close to your heart. With proper trust planning within your overall estate plan, you may be able to direct substantial resources to that charitable organization and possible reap important tax advantages along the way, too.    

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan





Thursday, October 12, 2017

Avoiding Probate | It Isn’t All Black or White

Summary: Very few things in life, or the law, are completely black and white. Most things are shades of gray. The correct answer to great many legal questions is, “It depends.” This also holds true when it comes to avoiding probate. Not everyone needs to plan to avoid probate as part of their estate planning (although a great many can potentially benefit from such probate-avoidance planning.) Which group you belong in is something you must decide, ideally in conjunction with the advice and counsel of an experienced estate planning attorney. 

In the third “Episode” of the famed “Star Wars” movie series, one of the movie’s protagonists, Obi-Wan Kenobi, instructs that, “Only a Sith deals in absolutes.” (The Siths are the movie’s evil antagonists.) The point of this statement is that almost all of the world is a series of shades of gray; very little is black or white. Anyone who speaks only in terms of absolute black-or-white either is being disingenuous, at the very least, is misinformed.

Estate planning can be like this. If you research estate planning, you’ll come across a lot about avoiding probate. Some of that information will try to tell you that everyone is better off avoiding probate. While an awful lot of people can, indeed, benefit from the costs and delays that can be associated with certain types of probate administration procedures, that is not an absolute black-or-white thing. There are some situations where having your estate go through probate is better for you than avoiding it. Here’s a list of a few examples:

(1)  You have minor children. In many states, the only way you can name a guardian to care for your minor children or other legal dependents is through a valid will. In a lot of places, the courts will presume that the appointment of this person as guardian is the best interest of your children. The only way to bring that appointment to life, and the only way that a will can have legal effect, is if the will is duly probated. So, even if all of your assets were structured to avoid probate, your will would still need to have a will and for it to be probated by the court in order for your naming of that guardian to be legally recognized.  
(2)   You have “problem” people in your life. Maybe it’s a creditor. Maybe it’s a relative. Whomever they have to deal with, there are some people who have people or entities in their lives whose presence could cause problems with the execution of your estate planning goals. It could be a contentious and uncooperative child, or it could be an unscrupulous creditor. Either way, situations like this are among the group of scenarios where the much larger degree of court oversight you get in a probate administration (as opposed to, say, the resolution of a living trust,) can actually be a benefit, not a hindrance. The judge’s greater involvement in your case could keep these “problem” people from derailing or complicating your estate plan and thwarting your goals.
(3)  You have certain types of debts/creditors. The law in most all states creates a limited period of time for a creditor to demand payment of a debt from the assets of a deceased debtor. If the creditor waits too long, then the creditor loses the right to demand payment. One way to shorten this period is by opening a probate case. By starting a probate administration, you may be able to cap this “limitations period” for pursuing debts to periods as short as 6 or 12 months. Without it, the period may run for many years, even more than a decade. (For example, in Maryland, filing a probate administration case can shorten the period from 12 years to 6 months.
(4)  You have only a very small amount of probatable assets. Some people may have very small amounts of assets. Others may have small amounts of assets subject to probate. Maybe you don’t own much at all, or maybe you own a used car, a house titled under a transfer-on-death deed, a life insurance policy, a retirement account with a beneficiary designation, your pre-paid burial plan and a bank account with a pay-on-death designation on it. In either of these situations, your collection of assets subject to probate may be small enough that you qualify for your state’s most simplified variants of probate. In those situations, as opposed to those who have to go through the full probate administration, completing the process can be very brief, quick and inexpensive.    

As you can tell from these descriptions, these are all relatively specific situations. A great many people are outside all of these groups and can potentially benefit from avoiding probate with estate plans that include living trusts. The key thing to remember is that none of this is black-or-white. That is why you need an experienced estate planning attorney, who can put his/her knowledge and skill to use for you and advise on what path makes the most sense for your circumstances.

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan