Reviewing your Insurance

Tuesday, October 6th, 2009

Some people don’t have the habit of reviewing their life insurance policies.  But bear in mind that an insurance could be a vital part of your financial strategy or estate plan.

You can buy a life insurance policy and make your spouse or children as beneficiaries.  Business owners can also use a buy-sell agreement funded with an attached life insurance so that surviving owners may buy the company’s interest in case of a deceased partner.  In the same token, key-person insurance assures business aid when one of the core employees passes away.

However, there is a downside to this.  Life insurance proceeds form part of your taxable estate and your beneficiaries may be heavily taxed when you pass away.  One alternative around this law would be to allow your children or other beneficiaries to own your policy.  You can give gifts to your kids for the acquisition of the insurance - it’s like pooling their money and buying the policy for you.  Another way you can remove the proceeds of your life insurance from your taxable estate is to get irrevocable life insurance trust.

Life insurance can help you build wealth.  It can also be useful for employee benefits, business continuation, education planning, retirement planning, and estate planning.

Tags: beneficiary, business, estate, estate plan, Estate Planning, law, life insurance, policy, tax, trust, wealth
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Estate Planning Dialogue

Friday, October 2nd, 2009

At times, discussions with family members and parents regarding estate planning may be stressful, emotional, and difficult.  However, the discomfort cannot compare to the pain felt in dying without implementing estate planning strategies.  When you rely on state governments to distribute your assets for you, your heirs may experience time delays and probate costs that may render them financially unstable.

So to ensure a life-changing and effective discussion, you must suggest a dialogue with your siblings or other concerned family members.  Arrange a convenient location and time, choose a comfortable setting, and of course, limit distractions.  It would also help to encourage an honest and open airing of goals and issues to stress that the discussion is very important.  Most definitely, everybody must implement an effective plan to serve the needs and wishes of all.

This is a very challenging task especially for the elderly parents who are initiating the discussion.  But this is needed to provide more control to the estate owner.  All issues must be discussed and understood by every family member.  They should also know the availability of legal documents including wills and trusts and use them as tools to have a successful discussion and ultimate peace of mind for everyone.

Tags: dialogue, discussion, elderly, Estate Planning, goals, owner, plan, probate, strategies, tools, trusts, Wills
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Estate Planning is for Children Too

Wednesday, September 30th, 2009

Do you know that when your children reach 18 years old, you will no longer be allowed to make medical decisions for them?  Actually, your right to see their medical records or speak to their doctor is no longer compulsory enforced.

Any parent has a fear of hearing that their child was involved in a medical emergency - whether it’s a physical catastrophe or a car accident, they would usually be notified or rushed into action.  However, under the law, your own 18-year old and above children need to name you as a health-care proxy first before you can have anything to say about their medical treatment.

Health-care proxies are documents allowing you to assign another person to make medical decisions for you if you’re unable to do it yourself.  Another document, called the living will, is a statement of medical wishes if you become ill.

Therefore, estate planning is not only for seniors.  Adult children should also have durable power of attorney as well as a health-care proxy too.  Since these are complicated documents, it’s best to speak to your family attorney.  If you don’t have one, just seek advice from any qualified estate planning attorney in your state.

Tags: adult, attorney, children, documents, Estate Planning, health-care proxy, law, living will, medical, parent, seniors, will
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Education Savings Plan in Estate Planning

Sunday, September 20th, 2009

Estate laws truly affect your assets.  Most of your assets constitute your estate when you pass away.  And since you know that an estate over $3.5 million will be taxed up to 45%, you may want to keep your estate below that level.  In order to do that, you can give gifts or acquire a 529 education savings plan.

Actually, this kind of education savings plan would allow you to select any relative or friend as your beneficiary.  That person is expected to incur education costs.  Moreover, the plan offers flexibility like for example; you can change the beneficiary any time, change investment elections, and make various contributions to the account.

You can choose from several 529 accounts that may be available in your state.  If you’re a resident of Ohio for instance, you can choose Ohio 529 plan and deduct your contributions from the state income tax.  Currently, IRS rules are allowing investors to make large lump sum contributions to the 529 plan.  In 2009 you can contribute up to $65,000 for individuals or $130,000 for couples.

So 529 education savings plan not only allows you to help your children grandchildren, nephews, nieces, and other loved ones from pursuing education, it would also allow you to qualify for tax deductions.  Seek advice from your estate planning attorney whether this strategy could be applied in your situation.

Tags: assets, attorney, education, estate, Estate Planning, laws, Ohio, plan, savings, strategy, tax deduction
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Your Will May be Fake

Thursday, August 20th, 2009

Many people are getting scammed when they seek assistance in writing their wills. A lot of solicitors can draft wills; however, these solicitors are not properly trained nor qualified to do so. In fact, there are many will-writers who don’t need to be regulated by Law Society before they offer their services.
According to a Liberal Democrat spokesperson for regulatory reform, enterprise, and business, Lorely Burt, “It’s no exaggeration that will-writing has now become a hunting ground for dishonest, incompetent, and fly-by-night operators.” Some offer a low fee but would keep adding extra charges for extra services and some involve outright scamming.

Since will-writers are not regulated, some problems also arise out of incompetence. For instance, an old lady wants to exclude her son from inheritance since he stole from her in the past. She made a will for her estate to be given to her care givers instead. But since she just used a will-writer who advertised in the local paper, her will was challenged by her son. And since it has been witnessed and drafted incorrectly, the will was declared invalid – effectively, she has no will and her son actually inherited everything after all.

Therefore, be very careful in looking for assistance to draft your will. To be safe, seek help from qualified estate planning attorneys. You can find many of them in online directories all over the web.

Tags: attorneys, directories, draft, Estate Planning, Law Society, Liberal Democrat, Lorely Burt, online, scamming, solicitors, web, will, will-writers, Wills
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Boomers Retirement Plans

Friday, August 14th, 2009

Times have changed, and the priorities come along with it.  This is true for the seniors and baby boomers as well.  Today, it’s more essential than before to plan your future given the increasing financial abuse received by seniors from caregivers or loved ones and the tough economic times.

Until now, the preceding American generation had been better off economically compared to their parents due to their inheritance, thriving economy, and job opportunities.  However, recent times don’t seem to be well.  It would be a good bet if the boomers will inherit a single title from their parents.  And the boomer’s children may even get less.

All these mean that seniors and boomers need to develop a plan for life, due to possible incapacity and inevitable death.  This planning process does not only involve “estate planning” or “financial planning” but “life planning,” “death planning,” “burial planning,” “nursing home or long-term care planning,” and even “pet planning” as well.

Creating and implementing these plans would need a huge multidisciplinary effort coming from a qualified team of professionals.  Among others, see a lawyer to help you handle your assets and complete your plan in case of incapacity, disability, and death.

Tags: American, baby boomers, death, disability, Estate Planning, incapacity, lawyer, priorities, seniors
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University’s New Planned Giving Director

Thursday, August 13th, 2009

There is a new planned giving director at University of Arkansas.  Renee Brida from Little Rock will be holding office in university development and reporting to Jim Harris, the executive director of gift planning and estate.

Prior to joining the development team, Brida spent almost five years as estate planning attorney for Little Rock’s Haught & Wade LLP.  She held a lot of fundraising positions in Little Rock including Arkansas Children’s Hospital, Pulaski Academy, and East Inc.

Through these positions, Brida was the one responsible for providing legal counsel in relation to organizational processes, developing a program for planned giving, planning & executing special events, running a fund campaign annually, and cultivating major gifts.  She holds a Psychology and English bachelor’s degree from University of Texas and earned Juris Doctor from San Antonio’s Mary School of Law.

Harris said, “Renee’s experiences as a development officer and attorney make her an idea candidate in leading the planned giving office.  She understands that working with friends and alumni as well as raising private gift support create plans that would work best in every unique situation.  So I have the highest confidence that she would do a good job of taking the planned giving efforts of the university and building new relationships to the next level.”

Tags: attorney, counsel, director, Estate Planning, Jim Harris, legal, Little Rock, Planned Giving, Renee Brida, University of Arkansas
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Procrastinating is a Bad Habit

Tuesday, August 11th, 2009

When faced with a difficult decision, people naturally procrastinate.  For instance, only 40% of people have an up-to-date will according to Visa Inc.’s recent poll.  A will is certainly not mandatory - although you don’t have to have a will when you die, you wouldn’t want to leave important decisions about your health and finances to strangers would you? Therefore, address these issues now and spare your family from dealing with them.

Consider hiring an estate planning attorney to draft and review your documents.  They can help you decide whether to create a simple will or come up with complex documents such as trusts involving large assets or complex estates.  Here are some things you need to do:

• *Before naming a power of attorney or executor, make sure they’re up to the task.
• *Name alternate executors and beneficiaries in case someone would die before you.
• *Compare trust or will beneficiaries to those named in your retirement or insurance plans to eliminate conflicts.
• *Review documents periodically, most especially when your family situation changes (death of a beneficiary, new child, divorce, or marriage).
• *Date, sign, and notarize documents as well as file them for safekeeping.

Tags: attorney, beneficiaries, documents, estate, Estate Planning, executor, family, procrastinate, strangers, trust, will
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Guide to Estate Planning

Monday, August 10th, 2009

Many would just watch their bills add up and portfolios dwindle.  Because of this, it’s very tempting to put off future planning.  However, experts caution that everybody needs to sit down in planning their estate.

According to the co-owner of a Seattle-based financial services practice called Sound Financial Partners, Debbie Whitlock, “Whether you’re debt-laden or wealthy, you should not just tell your loved ones how you want to handle your estate, you should put it into writing.”  Also, estate planning is not just about distributing cash.  It’s also making sure that your heirs don’t end up liable for all your debts.  In addition, you would prevent your loved ones from being saddled with funeral costs without hope of reimbursement, or sometimes it could take years of lengthy court process before they are reimbursed.

Planning for your estate could also be a way for you to determine what your life needs and goals are.  Do you want to ensure that your niece’s college education is paid for?  Or do you dream of giving a trust fund to your favorite charity?  Are you sure that you can still stay in your current house when your partner dies?  These are questions that can be answered with estate planning.

Tags: Debbie Whitlock, estate, estate plan, Estate Planning, goals, needs, planning, Sound Financial Partners, trust
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Never Ignore Estate Tax Planning

Monday, August 10th, 2009

At this point, a high percentage of Americans don’t need to worry about federal death tax.  Federal government allows tax-free exemption up to $3.5 million net worth for individuals and $7 million combined for married couples if they do some basic planning.  When they don’t have a basic estate plan, they could miss this full exemption and actually pay a seven-figure tax bill.

Currently, the federal law is hoping that in 2010, all states would pass this estate-tax-free.  However, off-the-record word from Congress says that there’s no way this law will survive 2009.  The states are re-evaluating their existing death tax rule.  There are some states that have no death tax, such as Florida.  While others, like Massachusetts or Connecticut have death taxes as high as 10% for a one million estate.

Therefore, it’s foolish to ignore the issue of estate tax.  Imagine people evading the local sales tax in their state, purchasing in another state, moaning about their annual income tax, yet doing nothing to plan for the largest tax they’ll ever pay?  It sounds ridiculous but it’s so common.

Ben Franklin may be right when he said “There are only two guarantees we have in life - death and taxes.”  And when death comes, taxes are voluntary.  Therefore, plan your estate wisely.

Tags: Americans, Ben Franklin, death, death tax, estate plan, Estate Planning, estate tax, federal, law, tax
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Estate Planning Options

Thursday, August 6th, 2009

In Wisconsin Statutes, the Ch. 770 addition encourages more same-sex couples to have more options to estate planning.  However, attorneys say that there are still a lot of questions to answer.  Michelle T.L. Hernandez, an attorney for Krueger & Hernandez shares that she has been receiving several calls about this process ever since the application for domestic partner declarations have started on August 3.

Over 400 couples have already filed for declarations - this means that same-sex domestic partners may inherit assets pursuant to state intestacy statute.  They may also sue a wrongful death of a deceased partner.  Hernandez said that this niche is still small.  As more couples register, she expects an evaluation whether she would change their trusts, wills, and estate planning documents and incorporate the new law benefits.  “I think attorneys implementing plans for domestic partners as well as those handing partnership termination will find this new area to be a brand new and hot law.”

Many attorneys are now encouraging their clients to apply for this domestic partnership status.  Same-sex partners will find that the new law provides a few “unique” opportunities in estate planning that is not available to them before.  This includes the ability to obtain the partner’s property, vehicle, or home in the event of death.    

Tags: assets, attorneys, death, declarations, Estate Planning, Krueger & Hernandez, law, Michelle T.L. Hernandez, partnership, same-sex couples, Wisconsin
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Legislation Complicates Taxes and Estate Planning

Thursday, August 6th, 2009

Florida Bar requires Florida attorneys to report a certain number of CE (Continuing Education) credits each year.  Most teleconferences and online meetings cost around $100.  So it’s a treat when a sponsor, Regents Bank, came in and paid for a series of lectures from Cannon Financial’s Attorney Roy Adams.  The bank offered local attorneys the chance to attend free, meet their staff in trust department, and receive CE credits for two hours.

Adams is a well- respected and known by estate planning attorneys in the area of speaking every January at Heckerling Conference in Orlando.  The event is attended by over 2,000 attorneys.

One of the topics was the several pending estate tax legislation in Senate and the House.  Most people will not be subject now to estate tax but when the unified credit amount or lifetime exclusion is $3.5 million (less gifts made) per person, this may reduce the lifetime exclusion (it may also be $7 million for a couple if properly planned).  If the lifetime exclusion will be reduced to $1 million (which is already scheduled after 2010) and new legislation doesn’t change the existing law, there is no estate tax.

However, many legislators feel that eliminating estate tax (even for only a year) will greatly contribute to increase of federal deficit - this will eventually be paid back by the taxpayers in the future.

Tags: attorney, attorneys, Cannon Financial, CE, Estate Planning, estate tax, Florida, Heckerling Conference, legislators, Orlando, Regents Bank, Roy Adams
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Understand Estate Planning

Sunday, August 2nd, 2009

In spite of recent financial setbacks, a lot of people are claiming to be better off financially compared to five years ago.  That’s why when a group of financial expert asked novices in the investment arena what estate planning they have done in the past, they were surprised that there was no affirmative answer.  Most people looked perplexed and raised their eyebrows.  It seems that they’re confused whether the expert mean setting up a trust or drawing up a will.

The expert asked not to be named but he said “It’s very interesting to find out that most people have never heard of the estate planning concept.  And even those aware of it have not taken it seriously.  However, it’s going to be a very serious issue when people get richer.” 

Moreover, the director of Transcend Consulting, Kartik Jhaveri pointed out that “We’ve been trying to spread the concept so that a lot of people are aware of it, but we don’t get a lot of queries.”  Therefore, a wealth manager concluded that “People usually find estate planning difficult to grasp.  So it’s much better for us to talk about different concepts of financial planning (such as retirement planning) to explain things to people.”

Tags: estate plan, Estate Planning, financial, Kartik Jhaveri, Transcend Consulting, trust, wealth manager, will
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Estate Plan for Faraway Real Estate

Saturday, August 1st, 2009

Do you have a condo in a ski country?  Maybe you have a house at any shore or a Florida time share?  So how much real estate do you have in several states?

No matter where your real estate is, your properties will be involved in your estate settlement unless you make some arrangements to your estate plan and avoid this complication.  Real estate law is a state law.  This means that only the courts in a particular state can have the authority in resolving issues about ownership and title of real estate property in that state.

So if you’re a Pennsylvania resident and you own a Florida condo, your estate settlement will require Pennsylvania domiciliary probate and a Florida ancillary probate when you pass away.  Take note that ancillary probate is always required in each state wherever you own real property.

The simplest way to eliminate the probate proceedings requirement is to title the real estate in joint names of your intended beneficiaries (probably with your spouse and children).  This is a simple device which means that in the event of your death, the real property will automatically pass to the joint owners without any probate proceeding requirement.

Tags: beneficiaries, courts, Estate Planning, Florida, owners, Pennsylvania, probate proceedings, real estate
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Estate Planning for Ranchers and Farmers

Monday, July 27th, 2009

When your family is engaged in agriculture, you have certain considerations to think of. You should consider if you will qualify for valuation deductions, divide the land into separate parcels, or make a charitable donation.

Practically, subdividing the land to give to children can raise both legal and practical questions. Legal questions include the minimum acreage requirements (whether it can be subdivided into parcels), deed of trusts (whether there are existing encumbrances that will affect future financing), and possible latent contaminations on lots that might become a responsibility to be cleaned up by your heirs.

Practical questions, on the other hand, include the dependability to water (or whether it’s feasible to subdivide the land), one part is locked (or access to roads), and distribution of electricity (or access to utilities). In addition, division of mineral rights and differing values should also be factored into your estate plan.

Finally, estate planning for ranchers and farmers (including vineyard owners) also involve business succession similar to closely held business families. This usually entails life insurance and buy-sell agreements. Moreover, predators, creditors, protecting children’s inheritance against divorce, Medi-Cal planning, and blended families’ estate planning may also be involved here.

Tags: agriculture, deed of trusts, Estate Planning, heirs, legal, parcels, practical
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Deal with Estate Taxes: Plan Ahead

Thursday, July 23rd, 2009

The golden rule in estate planning is: “Do it before you need it.”  Prudence actually suggests that we plan ahead because only a few people know when death can fall upon us.

In Oregon, there may be some last-minute opportunities for the residents despite its imposition of death tax on top of federal estate tax.  When federal estate tax exemption has been scheduled to dramatically increase, many states including Oregan became nervous since the federal exemption 10 years ago was $600,000 with 55% top marginal tax rate on the excess.  Simply put, the feds collect a large tax from a decedent’s estate - this includes taxable gifts that are made by decedents, and then, throws a portion back in state credit form.

Most states simply accept this “throwback” by imposing tax on its residents - this is the exact amount of credit permitted by feds.  However, when the feds have lowered the rates and increased exemption (currently $3.5 million and 45% flat tax rate), the state credit was also phased out.  Oregon reacted by simply enacting its death tax.  In other words, if the gross estate of the decedent exceeds $1 million (fixed Oregon exemption today), the excess will be taxed by the state.

Tags: decedent, Estate Planning, estate tax, feds, Oregon, plan, tax
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Blended Families’ Estate Planning

Wednesday, July 22nd, 2009

Richard Barnes witnessed the negative effects of a poor estate planning.  The families are upset, frustrated, and confused - they are forever shattered by it.

Even more confusing are those people in blended families - those families formed from second or third marriages - these are more difficult and precarious situations.  Barnes said that there are no instruction manuals for second marriages, and this time, you need to deal with new in-laws and step-children.

Amidst a larger cast of individuals, renewed estate planning could clarify your wishes.  This renewed estate planning could purchase additional life insurance, update a will dealing with prior relationships and reflect the current dynamics of new ones, etc.  Therefore, you need to learn various things such as dealing with heirlooms, how to select the best lawyer, etc.

Barnes further added, “It’s not just another marriage.  Somehow, it would seem that there are numerous challenges and geometric progression of personalities from first to second marriages.  There is a large amount of emotional issues surrounding people in second marriages.  And if clients would not think of these things (especially what to do with the properties and estate), there would be adversarial impact.  Only planning ahead would make it right.”

Tags: blended families, Estate Planning, lawyer, marriage, Richard Barnes, second marriage
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Estate of McNair in Limbo

Monday, July 20th, 2009

Former quarterback of Tennessee Titans, Steve McNair, left no will.  As a result, one of his son’s family (the one born before his marriage), was laying claim to their inheritance.  This could set up one lengthy legal battle.

David Callahan, Nashville attorney of Mechelle McNair (Steve’s wife), said that she’s determining the net worth of her husband.  A probate court judge in Davidson County granted her 60 days to complete this process as a response to her emergency petition.

The probate court filing states that the heirs are Mechelle McNair and her sons Trenton, 6, and Tyler, 11.  However, she can’t confirm whether the other two older sons of her husband are actually his.  Her husband died suddenly as he was shot on July 4 by a woman he was dating.

Steve McNair’s oldest son is Steven McNair Jr., Oak Grove High’s senior star wide receiver while his second son is Steven O’Brian McNair, 15-year old.  Cotina Feazell, the mother of Steven McNair Jr. did not find any records that the quarterback completed any estate planning or set up trust funds.

Attorneys say that even if the other women were not married to McNair, his sons are still eligible to the inheritance under state law.  There might be certain blood tests or other issues but all they need to do is hire an attorney to make a claim.

Tags: attorney, court, David Callahan, Estate Planning, inheritance, law, legal, probate, son, Steve McNair, Tennessee Titans, trust funds, will
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Draft an Advance Directive to be Prepared

Saturday, July 18th, 2009

Nobody would like to spend time mulling over their death.  However, it’s important to create an advance estate plan that will give you control over any situation when the time comes that you can’t voice your opinion anymore.  Estate planning attorneys’ advice: “You can’t change the fact that you will die.  And if you have the legal paperwork properly filed, you’re just showing that you respect the people you are leaving behind - you’re not putting them through stress and emotional turmoil than necessary.”

Fortunately today, anyone can draft an advance estate plan, which is a legal document specifying the things you want to happen when you’re no longer able to provide consent.  Aside from the distribution of your assets to beneficiaries, these advance directives would typically cover the situations you want when medical staff would attempt to revive you or the kind of life support you prefer to be put on.

At age 25, maybe you would want them to revive you at full blast (even hit you with lightning if possible) but at age 95, you may have a different perspective since you would not want to reach 100 years old hooked to these machines.  Therefore, advanced directives such as these would legally allow you to specify these things before the actual emergency situation when you’ll be unable to give directions yourself.  

Tags: assets, attorney, attorneys, beneficiaries, death, directives, emergency, estate plan, Estate Planning, legal, legal paperwork
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Online Wills are Essential

Thursday, July 16th, 2009

In your life online, you would normally create passwords and never share them with anyone nor write them down.  That should be alright when you’re alive, but this protection of sensitive information regarding your personal savings, insurance, or asset details can wreak a lot of havoc for your heirs when you die.

With increasing parts of our lives being stored online - password-restricted bank accounts, confidential messages, automatic bill-pay arrangements, and even photos - piecing together all personal information may cause your heirs major headaches.  For instance, if your online savings account is separate from your other regular bank accounts, this account may be overlooked in disbursing your finances to the beneficiaries since all statement notifications arrive exclusively through e-mail.

The chairman of estate-planning department in Springfield Massachussets and an attorney, Hyman Darling, said, “Many times we spend several days trying to locate the information.  Very often, these accounts would not be known for some time.”

But of course, creating a will where the decedent included all details about existing assets would help a lot.  However, it would still not solve the problem of knowing the passwords of certain accounts.  As Michael Palermo (another estate planning attorney) said, “Without these log-in information, the survivors need to ask assistance from the court to gain account access from the company running the online account.  And sometimes, this is not always easy.”  Therefore, it’s important to include these passwords in your will or entrust them to a trusted relative while you’re still alive.  

Tags: account, attorney, Estate Planning, Hyman Darling, Michael Palermo, online, passwords, will
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Include your Pets in Estate Planning

Tuesday, July 14th, 2009

When people head out of town for a week-long or month-long vacation, they make arrangements for their pet such as how they will be fed or taken cared of.  According to an attorney, Carol Wessels, “Many of my clients would simply trust another family member to take care of the pet.  However, they don’t realize that taking care of pets can be a huge responsibility.”

Since the United States is a nation full of animal lovers, Wessels predicted that the law practitioners’ interest in this particular estate law area will likely grow.  She added that pets will be better off if their owners think about their well-being too, and in advanced, so that they will be taken cared of when something unexpected happens.  This is because oftentimes, the surviving family members are taken aback with bills for food or veterinarians that these pets need.

Today, about one-third of sophisticated estate planners have pet trusts that will allow the pet owner to appoint a human beneficiary tasked to take care of the pet in the event of the owner’s death.  The conditions of the trust may state that the trustee can allocate money to this beneficiary as long as he or she is taking good care of the pet.

Tags: animal lovers, Carol Wessels, Estate Planning, law, pet, trust, trustee, United States
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Surprisingly Disinherited

Friday, July 10th, 2009

Kari Kennedy’s father died and she was crushed emotionally.  But when she found out that Liv, her dad’s ex-wife inherited more than $400,000, she got the biggest surprise of her life.  Liv and her dad had been divorced for many years.  In fact, she has a copy of their divorce decree which says that Liv is waiving all her rights to any retirement plan.

It may sound impossible but it’s true.  Estate planning looks so simple but it’s filled with pitfalls and landmines.  So if you failed to change the beneficiary in your retirement plan or insurance form your true heirs cannot contest it if you accidentally pass away.  In the above example, the law governing qualified retirement plans triumphs over the divorce decree.

This happens all the time.  Well-meaning individuals don’t change their beneficiary forms frequently and not willing to spend any money in hiring an estate-planning attorney.  They also forget that the results can be very disastrous.

Therefore, estate planning attorneys recommend that everyone should review all assets that they own - each legal document, trust, will, real estate titles, insurance policy, annuity, IRA, and retirement plan.  If you do this regularly, you’ll be sure that the inheritors of your belongings will be according to your wishes.

Tags: attorney, Divorce, Estate Planning, estate planning attorney, Kari Kennedy, legal document, retirement plan
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Donations are Beneficial to Charities and Heirs

Thursday, July 9th, 2009

If you are looking for a win-win strategy in estate planning, then give to charitable institutions.  There are many benefits of giving.  Here are some opportunities for you to give:

*Charitable Remainder Trusts (CRT) - a tax-exempt, irrevocable trust created when any donor irrevocably transfers assets to the trust.  Then, the trustee would invest the funds to pay a designated income stream for the donor in a specified period of time - this usually lasts for the donor’s lifetime and possibly the donor’s spouse as well.  Finally, after the end of term, the charity would get the rest of the trust assets.

*Charitable Lead Trust (CLT) - this gives income to a charity for several years, and then the rest would pass to the heirs of the donor.  This also allows the donor to get an income tax deduction applied to the charitable gift (the income stream going to charity).  Therefore, a CLT is the complete opposite of CRT.

*Outright Gifts - the simplest strategy to give to charity.  When you do this, you can benefit from a tax deduction.  If you want an additional benefit of removing your assets from your estate, you may give lifetime gifts such as real estate or stock.

*Retirement Benefits - an ideal asset to give to charity.  You can simply give the name of the charity as designated beneficiary with IRA custodian or plan administrator.

Tags: CLT, CRT, Estate Planning, Outright Gifts, Planned Giving, retirement benefits
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Your Final Arrangements

Wednesday, July 8th, 2009

Recently, Indiana took another stab to address uncertainty in the final arrangements of a person.  It was mandated that starting July 1, any person may execute an FPD (Funeral Planning Declaration).  When you execute an FPD, you can nominate anyone to be a “designee” - this person will carry out your final instructions.

The form is so easy and simple to understand.  In your FPD, you can leave instructions regarding grave memorial, ceremonial services, funeral, entombment, cremation, and burial.

The traditional way that you can plan final arrangements is through a will.  Unfortunately, some beneficiaries don’t know where the will is; and in some case, the deceased was already buried when they’ve found it. 

Another common way is to preplan by going to a funeral home.  This means that you make decisions based on a field expert’s guidance.  But who wants to go to a funeral home to begin planning?  The reality is that people think it’s creepy to discuss an estate plan in a funeral home.

Truly, one of the most difficult parts of estate planning would involve final arrangements.  These issues could also become complicated if there are mixed families, second spouses, or the members of the family just won’t get along.

Tags: estate plan, Estate Planning, final arrangements, FPD, funeral home, Indiana, instructions, preplan, will
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Make Estate Planning Your First Step after Divorce

Monday, July 6th, 2009

The last thing that people want to do after a divorce is to consult another attorney.  But regardless of your age and whether you have kids or not, it’s important to consult legal and financial experts to ensure that your financial plans and estate are updated in terms of reflecting your new circumstances.

So if you’re not working with an estate planning attorney or financial consultant during your divorce, it’s time for you to do it now.  A financial planner will look at your finances. Your expenses as a new single individual can grow unexpectedly; a financial planning professional helps you compare strategies and review your new savings and spending needs.

Also, talk with an attorney that has numerous experiences in real estate.  If you plan to remarry one day and you have kids, make sure that your specific assets will go to them (guaranteed) when you die.  This is because some cases happen when the ex-spouse may automatically gain full control of assets earmarked for your kids.  Of course you don’t want this to happen - that’s why you must plan for it legally.

If your children are still minors, it would also be wise to plan the guardianship for them.  Especially when there are wealth issues that’ll only become effective when they reach adulthood, it’s critical to establish a solid and efficient legal structure to distribute those assets.

Tags: attorney, Divorce, estate, Estate Planning, estate planning attorney, experts, financial, financial planner, legal, minors, plans
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Estate Planning Aided by Key Documents

Thursday, July 2nd, 2009

Tenise Owens, Troy Bank’s trust officer was a keynote speaker at Healthy Woman seminar.  She said, “Everyone over 19 years old should have a will.  Advanced medical directives, a will with instruction letter, and a strong power of attorney are the key documents needed by each person before the need arises.”

She further revealed that, “The state will be very happy to distribute the money for you if you don’t have a will.”  She calls estate planning as the people’s “financial health” and outlined the pros and cons of having a durable power of attorney.  “We highly recommend that people go to their own attorneys and draw up their will.  You would definitely want someone standing behind you if people will challenge your will.  Therefore, downloading a will from the internet just won’t do,” she revealed.

Powers of attorney may be changed.  She urged the group in keeping the financial institution informed of the revisions.  She shared “We keep the copies of powers of attorney on file - we consider it a binding document unless we’re otherwise notified.”

When someone dies, many people typically go to financial institutions and expect to transact their business with a power of attorney.  However, she said, “A power of attorney would become null and void after a person’s death.  That’s when a ‘will’ would come into play.”

Tags: attorneys, Estate Planning, Healthy Woman seminar, power of attorney, Tenise Owens, Troy Bank, trust officer, will
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Celebrity Estate Planning

Wednesday, July 1st, 2009

With so many celebrities passing away recently - Karl Malden, David Carradine, Farrah Fawcett, and Michael Jackson - there’s been a lot of talk about lack of proper estate planning.  Some celebrities who passed away without even planning their estate are Elvis, Anna Nicole Smith, Jerry Garcia, and Heath Ledger.

Apparently, Michael Jackson did some planning; however, his documents were not updated for more than 7 (seven) years.  So it goes to show that when celebrities neglect this very important step, then there are dreadful consequences.

You might be thinking that you don’t have an estate to protect like them and you probably don’t need estate planning.  But be informed that whatever size your estate is, it does not excuse you from executing an estate plan.  Simply put, it’s a plan that will ensure your family’s financial needs are met after you die.

So if you own a home (whether mortgaged or not), a business, or any other asset (such as insurance policies), you need an estate plan.  Certainly if you have children, you would want to ensure a bright future for them even after you’re gone.  The only way to do this is to dust off your documents and review them to see and decide on the beneficiaries of your assets.  It would be better if you speak to an estate planning attorney to seek help in taking care of this.

Tags: beneficiaries, celebrities, estate, estate plan, Estate Planning, estate planning attorney, Michael Jackson
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Estate Planning Process

Saturday, June 27th, 2009

Business succession planning should address the continuity and transfer of tangible assets such as equipment and land.  This also includes intangible assets such as people and culture.  Aggressive succession planning encourages transfer of farm or business to the next generation before the death of its owners.

Estate planning is essential because it prevents liquidation of your assets to cover tax liabilities.  It’s an ongoing process of expressing, designing, refining, and adopting the programs, structures, and documents needed to achieve the continuity objectives of your family business.  In addition, it requires communication, refinement, and continual review of necessary plans and transfer to your vendors, key personnel, partners, and family who’ll be affected by your loss.

The process must accomplish three goals:

• *Establish plans for continuity of family assets or family business
• *Initiates transfer of assets to charities and family members prior to death
• *Upon death, completes transfer of assets with minimum administrative hassle and cost, according to your wishes

Be careful to avoid estate planning complexities that often arise out of unfocused objectives, dysfunctional relationships, and special family circumstances.  To protect the rights of your beneficiaries or descendants, hire an estate planning lawyer who will be the executor of your estate.

Tags: assets, business succession, Estate Planning, estate planning lawyer, executor, family business, lawyer, tax liabilities
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Alternative Lifestyles Estate Planning

Wednesday, June 24th, 2009

When you say “alternative lifestyle,” it encompasses anything except a legal union of man and woman as a husband and a wife.  But whether you know how to use this term or not, estate planning’s surrounding laws are still predicated on specific family structure.  In many cases, that family structure doesn’t exist, that’s why particular attention needs to be given to estate planning.

For instance, the existing federal estate tax system is allowing unlimited marital deduction coming from estate taxes.  Simply put, even if you’re as rich as Bill Gates, there’s no federal estate tax when you leave all your money to your surviving spouse.

Because federal definition of marriage says that “it’s a legal union between a man and a woman as one husband and wife,” you need to make a different planning technique because unlimited marital deduction isn’t available to you.

Moreover, state and federal laws have default provisions and there are certain rights granted automatically to a spouse.  So if you don’t have a spouse, no one will have those automatic rights.

Estate planning may be difficult for many people.  However, you need to take a very active role to determine your estate plan so that you can make the decision to pass on your estate to the right person when you’re gone.  It’s best to seek the help of estate planning attorneys to assist you.

Tags: alternative lifestyle, attorneys, Estate Planning, Estate planning attorneys, federal estate tax system, marriage
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Make Sure You Have the Right Estate Plan

Monday, June 22nd, 2009

There was once a lady who recently lost her husband.  She is in the midst of settling his affairs but the problem is that she’s having trouble cashing a check from the insurance company because it’s payable to a trust.  However, she claims that they don’t have a trust in place.

After reviewing the check and a pile of papers, the Indiana Bar member, senior trust officer and vice president of First National Bank, Christopher W. Yugo, indeed found a joint trust amendment which changed the trustees.  The amendment was signed by the lady and her husband but she swore that she never met an attorney.

As Yugo probed deeper, he realized that the couple sought the assistance of a financial planner for their estate plan.  Then, the planner took the information to one attorney who prepared the necessary documents.  In the end, the documents were returned to the planner who probably did his best to execute the plan while ignoring the implications of unauthorized law practice.

You can learn two things from this story.  First, be careful who you approach for estate planning advice.  It’s always critical for you to meet with an attorney before executing an estate plan.  Second, it’s important to have a basic knowledge of estate planning.  Furthermore, don’t hesitate to ask a lot of questions to your attorney so that you’ll understand every detail of your estate plan.

Tags: attorney, Christopher W. Yugo, estate plan, Estate Planning, financial planner, trust, trust amendment, trustees
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Critical Factors in Estate Planning Process

Saturday, June 20th, 2009

The nature of your various assets and how you are holding title to those assets are critical factors in your estate planning process.  Before you change title (or take title) to an asset, you have to understand the consequences of your proposed change.  Seek the help of your estate planning lawyer to advise you on:

• *Separate property and community property - if you’re a registered domestic partner or you’re married, the assets that you or your domestic partner earns are part of a community property. However, you can also continue to own separate property. These may be property that you own prior to marriage. Also, inheritance or gifts received during the partnership may be considered separate as well. Community property can be converted to separate property (and vice versa) through a written agreement.
• .
• *Tenants-in-common - for example, several people own property and a co-tenant (co-owner) dies, then the co-tenant’s property interest would pass on to the beneficiaries named in the will.
• .
• *Joint tenancy with survivorship right - single or married co-owners that own property can hold title as joint tenants with survivorship right. Therefore, if one tenant dies, the property would pass on to the surviving tenant overriding the will of the deceased person.
• .
• *Community property with survivorship right - typically, married people would hold title to property by passing it to the surviving spouse in the event that the other party would die. This would also pass on without any influence of the will created by the deceased person.

Tags: assets, community property, Estate Planning, estate planning lawyer, gifts, inheritance, separate property
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Introduction to Planned Giving

Friday, June 19th, 2009

A term that’s commonly used to describe donating to charity during one’s lifetime or after death is called “planned giving.”  This is done while meeting your current needs as well as providing for your heirs.  Also, it’s typically done with estate planning.

From the perspective of the donor, planned giving may be attractive for many reasons.  First, it allows you to give larger gifts out of your existing assets.  And it may also reduce your estate taxes or capital gains, earn higher investment yield, or give you an income stream for life, depending on how you set it up.  These planned gifts normally appeal to people who are not sure how much assets they’ll need during their lifetimes, and at the same time, want to benefit charitable organizations.

Planned gifts may be used to start a private foundation, create a support organization, establish your own fund at any community foundation, or give to a specific nonprofit organization.  The most common planned giving vehicles are beneficiary designations, charitable requests, charitable lead trusts, charitable remainder trusts, and gift annuities.

For more information on these programs, consult an attorney or professional advisor.  You can find them in any attorney listings or directories online.

Tags: assets, attorney, attorney listings, capital gains, charitable organizations, directories, Estate Planning, estate taes, gifts, online, planned gifts, Planned Giving
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