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re: Estate Planning

Articles About Estate Planning

While estate planning attorneys advise clients to review their estate plans every five to ten years often people do not. Here are 10 reasons or situations when people should review their estate plan. 

You may feel that you have given one child more during your life, so he or she should get less in your will. Or you may want to cut out an heir altogether. Whatever the reason, disinheriting a close relative–especially a spouse or a child–can be complicated.

Estate administration is the process of managing and distributing a person’s property (the “estate”) after death. The article outlines the steps that the surviving members should take after a death has occured. 

Here's how to protect your vacation retreat from the taxman and intrafamily strains. 

Wealth improperly distributed can hurt children with special needs, because they risk losing government benefits for their care if they have too much money in their name. At the same time, their parents need to have more life insurance than typical parents, particularly early in their lives, to ensure there is enough money to care for their child into adulthood. Most parents are going to need help navigating the benefits that their special-needs children receive, including funding for physical and occupational therapy, reimbursements for specially tailored schools and government assistance when the children become adults.

If you don’t have much money, why do you need to do estate planning? Contrary to popular misconception, you don’t have to own a big house to have an estate. Your estate consists of everything you own when you die, including your home, personal property, investments, bank accounts, retirement plans and any interests in a family business or partnership. Beneficiary designation forms control who gets retirement accounts, along with life insurance proceeds. For most other assets, you need a will or living trust that says who gets your stuff.

For estate tax planning purposes, married couples traditionally use a planning technique known as "A-B" trusts. Upon the death of the first to die, the original single trust is split into two trusts, a "decedent's trust" or "tax credit trust" (A) and a "survivor's trust" (B). The decedent's trust is funded with the greatest value of assets on which there will be no federal estate tax for the first to die. The remainder of the couple's assets fund the survivor's trust. Done properly, at the death of the second spouse, the assets in the decedent's trust go to the children, with no taxes due, since they technically passed to the next generation under the estate tax exemption of the first spouse who died. In this way, the couple is still able to take advantage of the estate tax credit granted to each individual spouse.

So you have decided that taxes have nowhere to go but up, and you are converting your traditional IRA to a Roth. But what happens if you die when your grandchildren are still young?

A trusteed I.R.A. is a relatively easy way for parents to control how, when and why their children receive the distributions from their retirement accounts.

Emotions can run high at the death of a family member. If a family member is unhappy with the amount they received (or didn't receive) under a will, he or she may contest the will. Will contests can drag out for years, keeping all the heirs from getting what they are entitled to. It may be impossible to prevent relatives from fighting over your will entirely, but there are steps you can take to try to minimize squabbles and ensure your intentions are carried out.

A recent article by syndicated columnist Mark Miller discusses popular retirement calculators and flaws that could lead to serious miscalculations when planning for retirement.

Question: My 39-year-old son has a spotty health and employment history. He is likely to have minimal savings upon his retirement. How can I fund a hopefully tax-deferred retirement fund for him now without his knowledge?

Parents, it's time to be an adult when it comes to talking to your kids about your late-in-life planning. Many times the burden of managing a parent's deteriorating health or financial situation means an adult child has to step into their parent's shoes. But parents often can accomplish more by stepping into their former role and taking the lead. Doing so can head off divisive—and costly—family feuds.

Only a few U.S. organizations offer people the chance to create video testimonials, which are meant to supplement and expand upon written living wills and Physician Orders for Life Sustaining Treatment (POLST), now available in 26 states. Do-it-yourself videos are also a convenient option.

Close to half of Americans die owning very little in financial assets, with senior citizens relying heavily on Social Security to help get them through their retirement years.  

An inter vivos trust is a trust created during the settlor’s lifetime which becomes effective while the settlor is still alive as contrasted with a testamentary trust which takes effect upon the settlor’s death. Because an inter vivos trust becomes effective during the lifetime of the settlor, it is commonly referred to as a “living trust.” Living trusts are often pitched as the panacea that reduces expenses and avoids lawyers, taxes, and probate in advertisements by attorneys and other promoters of living trusts. Despite the tremendous potential benefits of living trusts, however, they are not for everyone. Living trusts must be used wisely after thoroughly evaluating the potential benefits and disadvantages. This article provides a discussion of the pros and cons of inter vivos trusts which a client must consider before deciding to create an inter vivos trust.

Joint ownership of bank accounts, investments and real estate can have both significant benefits and risks. To understand these, we must first explore the three types of co-ownership: co-tenancy, joint ownership and tenancy by the entirety. All three types of ownership can apply to real estate, but more rarely to other types of investments where joint ownership predominates.

Every year, thousands of consumers bypass lawyers and create their own wills, powers of attorney, and other estate planning documents with the help of online tools and books. As one might expect, lawyers don't like this do-it-yourself approach. They say it breeds mistakes, since when it comes to legal issues, one size never fits all. Do they have a valid point, or are they just trying to protect their own livelihoods?

Family-owned businesses have been called the “backbone of the U.S. economy,” but passing control of a family business to the next generation is so complex that the majority of family businesses do not survive the transition.

Here’s what you’re probably missing, why you’re missing it and how to set it right by the time you retire. 

The list represents some of the most frequently encountered issues in advising clients who wish to secure the future of a beneficiary with a disability.

Answers the question: My wife and I are both over 65 and are doing some estate planning. Can I transfer funds from a traditional IRA to a trust without immediately being taxed? What would be the tax consequences of making the trust the beneficiary of my IRA?

There are many reasons for leaving assets in trust rather than outright. These include protection from creditors, protection from spouses, asset management, control over distributions, Medicaid, and keeping the assets out of the beneficiaries' estates for estate tax purposes. This article explores the tradeoffs and special considerations involved in leaving retirement benefits in trust rather than outright.

Okay folks, I finally got up the nerve to address trusts and how to use them to avoid probate. I offer this with a warning that applies to a lot of things in life: Just because you can do something does not mean that you should.

Patti's Comment:  This is a wonderful article that makes trusts understandable for all!

Insurance agents and financial institutions often advertise annuities as the perfect way to generate retirement income. While annuities can be a valuable retirement tool, if you are buying an annuity as part of a Medi-Cal planning strategy, you need to fully understand what you are getting.

People often wonder about the value of using irrevocable trusts in Medicaid planning.  Certainly gifting of assets can be done outright, not involving an irrevocable trust. So, why complicate things with a trust?

The law governing the protection of inherited individual retirement accounts from credits is uncertain at best. The statutes and court interpretations vary from state to state. Despite the uncertainty as to state law, an IRA owner can protect against beneficiaries' creditors by leaving it in trust rather than outright.

An outdated estate plan does you no good, so you need to make sure you keep your plan up-to-date. There are certain key life moments when you need to revisit your plan. When you get married — either a first marriage or a remarriage — you will need to update your estate plan. When you have kids, you can use your estate plan to name a guardian for them and to create a trust for them. If your spouse dies or you get divorced, you should make sure your estate plan reflects this. In addition, if your estate increases in value or decreases in value, you may need to evaluate your estate plan to determine if it properly minimizes estate taxes.

Is there a way to hand off a vacation home to the next generation so that everyone still wants to spend time together there? Tensions often mount when a family figures out what to do with a property that could be a lightning rod for sibling rivalries — not to mention a sizable chunk of an estate. Creating a new generation of family vacationers is the exception, not the rule, and it requires thoughtful planning.

Publications About Estate Planning

A "tool kit" with worksheets, suggestions and resources to assist in advance planning for health care decisions.

You have the right to make choices based upon your own values, beliefs and wishes, even if others disagree with you. Therefore, it is important to state your desires in writing about health and financial decisions when you are capable of clearly expressing your wishes.

This product provides an in-depth explanation of the process involved in drafting a last will and testament. It provides readers with crucial information regarding the meaning of commonly used provisions, as well as information surrounding issues that often affect the ultimate administration of a last will and testament. The reader will gain insight into who should have a last will and testament and the drafting process required, including ways in which the estate planning practitioner can add value for the client.

Looking Ahead explains the key components of estate and long-term care planning. The book serves as a guide both for doing prudent planning before a future need arises and for dealing with a life event that is looming, generally the need for long-term care. The basic rules of Medicaid planning are explained.

Although much has been written of the uses of LLCs in tax and business planning, comparatively little commentary has focused on the role of LLCs in estate planning.

As more "baby boomers" are retiring and rolling over large 401(k) and other retirement plans to IRAs, proper tax and estate planning for IRAs have become increasingly important. Two versions are included here: for consumers and for advisors

Revocable trusts are an effective way to avoid probate and provide for asset management in the event of incapacity. In addition, revocable trusts–sometimes called “living” trusts–are incredibly flexible and can achieve many other goals, including tax, long-term care, and asset-protection planning.

Explains the complex rules governing IRA accounts in determining the correct life expectancies to use in calculating required minimum distributions.

The advantages and disadvantages of Trust are explored