Showing posts with label Estate Planning Laws. Show all posts
Showing posts with label Estate Planning Laws. Show all posts

Monday, May 15, 2017

Estate Planning | A Gift to Yourself and Your Loved Ones


Summary: Creating an estate is one the greatest gifts you can give yourself and your loved ones. Your plan can give both you and your loved ones the confidence that comes from knowing that the decisions that will get carried out after you die (or after you are unable to speak for yourself) are exactly consistent with what you would have wanted. With this confidence, you and your loved ones can have the peace of knowing your legacy is the one you truly intended.

During the holiday season, many people obsess over the giving of gifts. They worry and fret regarding whether the gifts they've given are "the perfect gifts." Of course, another holiday season has passed and, with it, the time for giving holiday gifts. However, there is still one truly perfect gift you can give yourself and your loved ones, and that is an estate plan.

To yourself you are giving the giving of peace. Your properly crafted and executed estate plan can give you peace of mind from knowing that your legacy will be the one you wanted to leave. You can have confidence knowing that your wealth will be divided and distributed exactly in the manner that you want. With no estate plan, your assets are divided by a state statute enacted years ago by the legislature of the state where you reside. If you have estate planning goals that go beyond just dividing your wealth among your natural children and your spouse, then your plan can give you the peace of knowing that all of those that matter to you will be included in your plan.

Maybe you have a favorite charity (or charities.) Perhaps you have stepchildren whom you never adopted but whom you consider to be "your kids." Perhaps you have a beloved non-spousal partner, a trusty neighbor or dear friends who are important parts of your life and whom you want to be a part of your estate plan, as well. With your plan in place, you can rest easy knowing that they will all be included. 

Your plan also gives you peace of reducing the risk of your goals being thwarted. Maybe you have a child with whom you have an estranged relationship and whom you've decided to leave only a small (or no) inheritance. Even if your relationship with all your relatives is great, you could still be vulnerable to challenges by people such as someone alleging that he/she is your long-lost biological and legal child. With your plan, you can know that you've put down on paper exactly who is, and is not, supposed to receive a portion of your wealth.

This minimizing of the risk of courtroom battles also ties into another gift, which is the gift of providing for your family. You've spent most of your adult life providing for your family. Why wouldn't you want to take the necessary steps to give yourself confidence that you've continued to provide for them even after you're gone? Beyond just reducing the risk of estate litigation, your plan gives more to your family. Your plan gives them the confidence in knowing that the actions that get carried out after you've passed, from your final arrangements to who gets the house to who gets your prized collectibles, are exactly the ones that you'd have wanted.

Speaking of giving your family confidence, your plan can pass on this gift even before you die. Should you be in a position where you cannot make decisions for yourself, your plan documents can speak for you. Whether it's management of your assets or something much larger -- like end-of-life decisionmaking -- your plan, in the form of your powers of attorney and living will, can speak to your loved ones (and to others like financial institutions and doctors) for you, to ensure that your wishes get carried exactly in the way 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



    

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Monday, May 1, 2017

How a Living Trust May Be Able to Help when it Comes to Court Challenges to Your Plan


Summary: Some types of planning have benefits that are absolute. If you properly set up, properly execute and properly fund a living trust, you can receive the benefit of probate avoidance. Other objectives, like avoiding a court challenge to your plan after your death, cannot be guaranteed, even with the best of planning. Just because it isn’t guaranteed doesn’t mean that it isn’t worth doing. With careful planning, you can potentially reduce greatly the risk of a successful challenge that will disrupt your plan and possibly impair or block the completion of your objectives.  

A well-worn old proverb wisely opines that you cannot always prevent trouble or misery from coming in, but “you don’t have to give it a chair to sit on.” In other words, while we cannot always prevent bad things from happening, we should not leave ourselves in a position where it is easy for trouble to take hold… or get worse. Just because planning may not be able to give you 100% protection from certain potential miseries, it is still extremely beneficial and necessary in reducing your odds of some troubles.    

A properly drafted and full funded revocable trust will allow you to avoid the potential delays and costs associated with probate administration. It cannot, however, provide you with 100% ironclad protection against legal challenges to your plan. If you are in a situation where you believe your plan has a heightened risk of legal challenge by someone in your life, you definitely should still plan and consider planning with a trust. While a trust won’t immunize your plan from legal action, it will reduce your risks of this type of trouble.

For one thing, you are generally not required by law to tell anyone what’s in your trust, or even that you’ve created it. Certainly, there are important reasons why you would want to tell certain people about your trust. As an example, if you’ve named your granddaughter as your successor trustee, telling her promptly will probably help her prepare to carry out her duties more efficiently and successfully. However, if you have a daughter whom you’ve decided to leave only a small sum (or nothing at all,) there is no requirement that you tell her about your trust.

Additionally, trusts can help when it comes to legal challenges because, in most states, they ar generally harder to challenge successfully than wills. That does not mean that your living trust cannot be challenged. The legal system allows a wide array of people to file lawsuits for many reasons. However, in terms of mounting a winning challenge and thwarting you goals, a challenger probably has better odds in a will contest than a trust challenge in most places.

The law of most states also creates certain limitations on launching a trust challenge. If your state has adopted a version of the Uniform Trust Code, then your potential trust challenger has only a limited time to file their action. Under this standard, if your challenger is notified about the trust upon your death and waits more than 90 days, or waits more than 2 years after your death (whichever comes first,) then the law bars them from even pursuing this contest. 

Each plan and each family is unique in its complications and needs. Your estate planning attorney can help you identify your potential hurdles and pitfalls, and identify for you what tools, including living trusts, can help you carry out your objectives.         

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



         


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Monday, April 24, 2017

Avoid Traps Planning your Estate | Legacy Assurance Plan

Summary: Estate planning, like many legal matters, is something where there are many ways to accomplish any given goal. Just like meeting any legal, financial or medical need, there are techniques that are safe and reliable, and there are methods that risky and filled with potential dangers. There many techniques involving deeds that can transfer real property without requiring probate, but some of them can also cost you or your family thousands in taxes or, worse, cause you to lose the property completely. By working with a knowledgeable estate planning attorney, you can achieve your goals of avoiding probate without putting your home or other property needlessly in jeopardy.

When have medical issues, we usually go to a doctor to obtain treatment that we can trust is reliable and avoids risky methods of addressing the problem. Consulting an attorney for a legal matter, such as an estate planning need, works similarly. Your estate planning attorney can help you go about addressing your need in a way that you can trust. This type of help in planning can be essential because, for every trustworthy way to meet your needs regarding avoiding probate or accomplishing other objectives, there are as many unreliable traps that can ensnare your estate and your family in a mess that may cost considerable time and money to fix or, worse, lead to an outcome that is different from what you wanted.

With that in mind, here are a just a couple risky probate-avoidance methods that are examples of potential traps that can exist for you:

1. The pocket deed. This a deed that you execute signing own your home or other real estate to the person you want to have it upon your death. In a perfect world, this method works because the deed doesn’t get recorded until you die, so you are able to continue possessing that property until after your death. Unfortunately, ours is not a perfect world. If, for some reason, that deed gets executed during your lifetime, you could be thrown out of the property immediately.

You could also lose the property if your desired beneficiary gets divorced or is in a lawsuit and the other side discovers that the deed exists. Even if none of these disasters happen, and the property passes after you die, using a pocket deed can still cause your beneficiary to lose valuable tax benefits (the so-called “step up in basis”) and have a much larger tax bill if he/she decides to sell.

2. Adding your desired beneficiary to your home’s deed. Some people seek to avoid probate by simply recording a new deed on their home or other property listing both themselves and their desired beneficiaries as co-owners of the property. In that way, the beneficiary takes 100% ownership of the property when they die.

This method is used much more commonly than the pocket deed. A lot of writers have written about the potential downsides of using this method and you may even already recognize this as a risky way to avoid probate. But even if you do already know that this is dangerous, you may not fully realize, at first glance, just how dangerous it can be.

Just like with a pocket deed, you have the risk of losing the property if your beneficiary gets sued or gets divorced. With this method, you can also create gift tax problems, since, if your beneficiary paid nothing to you, the IRS views what you’ve gone as giving a gift of 50% of the property. This means filing various tax forms and possibly paying gift taxes.

In some states, if you still have a mortgage on the property, adding someone to the deed can require you to pay a certain type of real estate transfer taxes on one-half of the outstanding balance of the mortgage. This can potentially amount to thousands of dollars in taxes. Another massive problem that can arise after using this method in some states is that it can cause your property to lose its homestead exemption. Losing a homestead exemption can potentially raise your annual property tax bill by thousands of dollars.


Also, adding your deed makes your beneficiary more than just a silent co-owner during your lifetime. That person has all of the same rights you do. You cannot sell the property, refinance the property or take out another mortgage on the property without the approval of your new “co-owner.”

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



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Thursday, April 20, 2017

Take Care to Choose Wisely in Selecting Your Executor or Successor Trustee


Summary: There are a number of very important decisions you have to make as part of the creation of an estate plan. One of the most important is the selection of your executor or successor trustee. Whether you choose one person or several people serving together will depend on the specifics of your family. Your estate planning attorney can help you sort through the benefits and drawbacks of all of your options.

When you begin the process of contemplating who should be your executor or successor trustee, it is important to select someone who is best equipped to carry out the instructions you’ve laid out in your plan. To help in this process, it is useful to avoid any possible confusion or misconceptions about the process of selecting your executor or successor trustee.

Don’t make the mistake of thinking that you have to choose only one person. This is definitely untrue. Each family is different and so, the person or people serving in this capacity will look differently. For some families, there may be one person who is uniquely well-suited to take on these responsibilities. Perhaps, for example, among your group of children, there is one who has the closest relationship with you, lives the closest to you geographically and also has the strongest acumen when it comes to business, legal and financial matters. For a family like this, it may make sense to name this child as both your executor and your first successor trustee.

In a lot of families, though, this will not be the case. You may have one child who lives nearby while a different one has the greatest legal and financial skill. In this example, you may want to consider making both of these children co-executors or co-trustees. It is very important to make sure that, if you name multiple people to serve at the same time, that they are people who can work together successfully to ensure the most efficient carrying out of your instructions.

You should also take care to name alternates in the event that your most preferred people cannot serve, whether due to their death, illness of other reasons. Naming second and third alternates helps to ensure that your plan will not be saddled with needing a judge to name someone to serve. This will cause delay, expense and may result in someone serving whom you didn’t want.

Another thing to keep in mind is that, depending on where you live, the person or people you want to serve as your executor (or one co-executor) may be ineligible. Some states have rules that limit executors to people who are residents of that state, or who make non-residents jump through extra procedural hoops in order to serve. One thing to keep in mind is that there are no similar rules restricting who may serve as the trustee of your living trust.

If the person or people you prefer live in a different state from you then, depending on where you reside, this may be another good reason to look at the possible advantages of including a revocable living trust in your estate plan. Selecting the documents to go in your plan, as well as the people to carry out the instructions of your plan, is one of the many pieces of the estate planning puzzle that your estate planning attorney can help you as you sort through the “plusses” and “minuses” of each option.

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





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Thursday, April 6, 2017

Planning for Your Stepchildren | How the Law Impacts Blended Families



Summary: Today, blended families are more common than ever. These families may include parents who were widowers, widows or divorcees. In many of these families, a stepparent's relationship with his/her stepchildren may become very close, such that the stepparent desires to include the stepchildren in his/her estate plan. Whether you have stepchildren you want to ensure get a portion of your wealth, or you have stepchildren you want to receive nothing, it is important to ensure that you have a valid estate plan in place, so that you can be sure that your objectives are achieved and you leave the legacy that you desire.

Here, in 2016, the legal standard of "no-fault" is the law in each of the states. California was the first to pass its no-fault divorce law, nearly a half-century ago. With the expansion of these laws has come an increase in divorces among American couples. With the substantial uptick in the percentage of couples whose marriages end in divorce has also come an increase in blended families. In many of these families, a stepparent may come to share a very close relationship with his/her stepchildren, eventually becoming as much of a parent-figure as the children's biological parents. In the classic TV show, "The Brady Bunch," Mike Brady's sons did not know Mike's second wife as "Stepmom" or "Carol." She was just "Mom."

However, the law does not always see things the same way. Generally speaking, unless you have initiated and completed the process of legally adopting your stepchildren, they have no relation to you under the law in most states. This can have a significant impact on your estate if you die with no valid estate plan in place. There is some variation from state to state in the intestacy laws regarding stepchildren and their right to inherit from stepparents. A few states, like Iowa, Kentucky, Arkansas and Missouri (among others,) say that stepchildren can inherit from a stepparent who dies intestate (meaning dies without an estate plan,) but only if the stepparent dies with no surviving relatives of any kind that can be located, and the only other option (besides distributing the estate to the stepchildren) would be allowing the estate to go (or "escheat") to the state treasury.

Others states, like California, say that a stepchild can take from a stepparent's intestate estate if the stepparent desired to adopt the stepchild but some legal barrier preventing the process from being completed. Very recently, a Michigan court case went even further. In that case, the deceased father died with a will, but the court declared that document to be a forgery. As a result, the court declared the man to have died with no plan, and distributed his intestate estate three ways, between a son, a daughter and the man's stepson. In this case, the stepson became an heir solely based upon his having formed a parent-child relationship with the stepfather before age 18 and continuing that relationship until the stepfather died.  

What does all this legal language mean for you? It means that, for the vast majority of people, it is best to get an estate of your own choosing put into place, and not leave your legacy up to the laws of your state of residence. If you have stepchildren, there are two distinct scenarios where allowing your wealth to be distributed according to intestate law can go very wrong. The first situation is if you have stepchildren with whom you are close and whom you want to include in the distribution of your wealth. If you live in one of the majority of states that does not recognize unadopted stepchildren as relatives, then they will get nothing from your assets unless you get an estate plan with a will (or will and living trust) that dictates who you want your beneficiaries to be. With a properly drafted and executed will or living trust, you can ensure that your stepchildren will get the fair share of your assets that you want them to have.

Alternately, you may have stepchildren with whom you're not close and whom you don't want to receive anything. While most intestacy laws say unadopted stepchildren get nothing, laws can change. And you may already live in a state that recognizes unadopted stepchildren as relatives. Again, the best way to make sure that your goals are achieved is to ensure that you have a validly drafted and executed estate plan in place. The law says that you can disinherit anyone except your surviving spouse. Whether someone is a child or stepchild, you can leave them nothing as long as it is properly spelled out in a valid estate plan.  

 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



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Monday, April 3, 2017

Guardianship Abuse | How you can Protect Yourself


Summary: Courts, legislatures and attorneys general are continuing to come face-to-face with the ongoing scourge that is the misuse of guardianship legal proceedings in order to abuse seniors. While this abuse can often involve the loss of a senior's personal autonomy, it also often involves financial abuse, as well. There are certain things seniors can do to protect themselves, especially when it comes to estate planning. But taking pro-active steps to to put a complete estate plan into place, you can better protect yourself from the possibility of someone using the legal system against in order to seize control of your wealth.   

Another state is taking on the monumental task of trying to reform its system of adult guardianship and conservatorship. In this case, that state, as reported by the Associated Press in October 2016, is Nevada. That pursuit of reform came on the heels of a 15-month study into the system, which revealed far too many stories of "'abuse, fear and distrust' in the program." The state's Attorney General, who also promised to attack the problem, promised to do what his office could to prevent guardians from swindling the people they were supposed to be protecting.

The "flash point" that helped trigger this action was series of newspaper reports in the Las Vegas Review-Journal, which exposed a considerable amount of this abuse that was going on. "Some of the cases were just horrible to read," Barbara Buckley, the executive director of the Legal Aid Center of Southern Nevada, told the newspaper. "Individuals in this situation are being stripped of their civil liberties, the right to run their life as they see fit, without anyone speaking to them or advocating on their behalf."

Other states have discovered similar problems and have sought to put reforms into place to stop this abuse. One of the earliest sources splotlighting this problem of guardianship abuse was a book entitled, "The Retirement Nightmare," by Diane G. Armstrong. Originally published, in 2000, Armstrong's book sounded the alarm regarding how this previously relatively little-known part of the legal system was being abused to strip away seniors' rights and wealth.

In her book, Armstrong outlined several vital, and easy, steps people can take to reduce or eliminate their risk of being the subject of an unwanted and unneeded guardianship proceeding. Although the author published her book 16 years ago, her advice when it comes to estate planning is just as useful today as it was in 2000. First, Armstrong recommends "working with the right attorney." This of course, is key. An attorney experienced in the law of estate planning can give a full picture of the legal options available to you for your estate and make helpful recommendations regarding what estate planning tools will (or won't) help you achieve your planning objectives.

In her second and third points, Armstrong highlights executing the proper legal documents to carry out your planning goals. These documents, which make up a complete estate plan, include a will, a power of attorney for financial decisions, a power of attorney for healthcare decisions, a living will. Depending on your situation, you plan may also include a revocable living trust.

A living trust is often best-known for its potential benefits when it comes to avoiding probate. But a living trust may also offer a degree of protection when it comes to an involuntary guardianship, as well. Sometimes, people go to court asking a judge to declare your mentally incompetent and appoint someone to manage your assets (often known as a conservator or guardian of the estate,) in order to take the control of your assets away from you and put it in their hands. A living trust may help you avoid this potential pitfall. Your properly funded living trust may be able to help even if this were to happen. That's because, in your revocable living trust, you likely named yourself as the initial trustee and named one (or hopefully multiple) successor trustee(s,) whom the trust stated would take over managing the trust if you died or were declared incompetent. Therefore, even if a judge did make such a declaration, all that would happen in your case is that the management of your assets would pass from you to the person you named as your successor trustee when you signed your trust document. 

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





   
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Monday, March 27, 2017

Trust Funding | You’ve Created Your Estate Plan With a Revocable Living Trust… Now What?


Summary: Proper estate planning is a process, not just a single task. Rather than being a single step, estate planning is more like an ongoing journey. Just because you have set up and executed a set of estate planning documents, that doesn’t mean your estate planning is “done.” This is especially true if you have a plan with a revocable living trust. Once you’ve put your signature on all of your documents, including your living trust, there are beneficial things you can begin doing almost right away to ensure that your plan will be properly maintained.             

One of the first things you can do, if you haven’t begun already, is put together a list of all your assets. You’ll need to list both your titled assets (like your home and vehicles, for example,) as well as your personal property (like furniture, jewelry and collectibles.) You’ll need each of these lists for two different reasons. For assets like real estate, vehicles and financial accounts, you will need to make certain that they are funded by executing the proper paperwork establishing that you have transferred ownership of that asset from you as an individual to you as the trustee of your trust. Of course, this means that one of the first things you’ll need to do after you’ve finished compiling your list is obtaining all of your current ownership documents, such as the deeds to all of your real estate properties and the titles to all of your vehicles. 

For your real estate, funding means obtaining a deed from an attorney putting the transfer into legal effect. For your vehicles, funding entails a trip to the DMV and re-titling the auto. For your financial accounts, the institution where you hold your account(s) probably has their own special proprietary paperwork they’ll require you to fill out to complete the transfer.    

When it comes to your personal property, especially specific items that you want to specifically distribute to a particular beneficiary, your list will be especially helpful in making certain these assets get funded, too. They get funded a bit differently, however, since they don’t have deeds, titles or other ownership paperwork. These assets get listed in a special place in your trust, which is usually referred as “Schedule A,” “Appendix A” or something similar. Listing these assets in your trust’s schedule is a means of putting down in writing your intent to transfer them from you to your trust, where they can be distributed in accordance with the special instructions you’ve laid out in your trust document.      

A popular self-help book from the 1990s advised, “Don’t sweat the small stuff.” That may be true in a lot of areas, but not when it comes to funding your trust. Here, you want to be more like Santa Claus, as in “making a list and checking it twice” in order to be sure you’ve not left anything out. Do you hold an ownership interest in a business like an LLC, partnership or corporation? These assets can potentially be transferred into your trust, depending on the business’s operating agreement or articles of incorporation. Do you hold any copyrights, patents or trademarks? The appropriate government office (the U.S. Copyright Office or the U.S. Patent and Trademark Office) have transfer forms. Additionally, if someone owes you money (whether from a loan or a legal judgment,) you can create a document that says that you are transferring, or assigning, your right to collect that debt to your trust. 

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



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