If one or more of your children have accumulated a lot of debt, you might hesitate to give property to those kids in your estate plan. The property might well end up in the hand’s of a child’s creditors, so many people think it better to give the property to another family member. However, you can leave assets to an indebted child without fear that creditors will get it all. A spendthrift trust is specifically designed for this type of situation. You can fund the trust with the money and … [Read more...] about Protecting Your Kids’ Inheritance From Their Creditors
Advanced Estate Planning
Minimizing the “Death Tax”
Effective estate planning can help you to minimize or completely avoid the federal estate tax, sometimes referred to as the "death tax". California presently does not have a state estate tax. Some professionals call the estate tax a “voluntary” tax because you only volunteer to pay it if you don’t sufficiently plan. You can avoid estate tax by: Creating a life insurance trust (ILIT) to own life insurance policies on your life. If you don’t own it, it’s not taxed at your death. … [Read more...] about Minimizing the “Death Tax”
Small Business Owners: Don’t Forget to Plan
If you own a small business, you have plenty to think about on a daily basis. However, have you considered what would happen to the business upon your death. If the business has been successful, you also likely have a considerable financial interest in the business. Without careful planning, the value of your financial interest in the business can be subject to either gift or estate taxes upon your death. Although there are numerous options that may be used to help reduce estate or gift taxes, … [Read more...] about Small Business Owners: Don’t Forget to Plan
Incentive Trusts: Using Your Legacy to Benefit Your Loved Ones
Leaving someone an inheritance is not as simple as adding some zeros to his or her bank account balance. It can be…but this is not always in the best interests of your loved ones. It’s likely that some of your heirs are mature and established with a history of being able to handle their own affairs appropriately, and you may have no concerns about them. But you may also have some younger heirs who have not yet made their marks in life, or some family members who have personal problems or a … [Read more...] about Incentive Trusts: Using Your Legacy to Benefit Your Loved Ones
Special Needs Planning; Some Considerations
If you are the parent of a child with special needs, planning for his or her future without parents is a more critical matter than the issue would be for a parent of a child who is not disabled. The concerns are twofold: who will your care for child if you become incapacitated and what happens to the child at your death? Some of the questions you need to consider when you begin the planning process are: Whom would you trust as guardian for your child if you were unable to care for them … [Read more...] about Special Needs Planning; Some Considerations
What You Need to Know About Testamentary Trusts
A good trust is one that suits your needs and desires. For many parents with young children, a testamentary trust is exactly what you are looking for if you are concerned about your children being able to manage property if you were to die suddenly. Here are a couple of quick points about testamentary trusts and why they are useful. The trust relationship. Every trust is basically a specific legal relationship between certain people. When you create a trust you select who these people are … [Read more...] about What You Need to Know About Testamentary Trusts
What the Heck are Digital Assets?
If you think the terms “digital estate” and "digital assets" sound foreign, you are not alone. Until recently, most people did not even worry about how to include their digital assets in their estate plan because they did not have one. Today, however, even the average American owns digital property. As the world moves to computing in the clouds, we will all have more digital property in the years to come–all of which needs to be included in your estate plan. In case you think you don’t have … [Read more...] about What the Heck are Digital Assets?
Family Estate Planning Should Include the Family Business
If you own your own company, you know that running a business is a complicated venture that takes loads of planning time. Besides planning to grow and expand your business, you must also determine what will happen after your death. No Business Estate Plan If you don’t include your business in your estate plan, then it may not survive your death. If you have full or partial stake in a business, it will be considered a part of your estate upon your death. If you have not named someone to … [Read more...] about Family Estate Planning Should Include the Family Business
Decanting: It’s not Just About Wine
Decanting is a familiar process in winemaking as well as in chemistry. However, it is also a sophisticated process in estate planning. California recently passed legislation enabling it's use in the state. Question 1: What is decanting? Decanting is the process of transferring property from one trust to another. Specifically, the term applies when a trustee transfers property from one irrevocable trust to a new trust that has terms different than the original. Question 2: Why is … [Read more...] about Decanting: It’s not Just About Wine
A Primer on Gift Taxes in 2022
Both the gift tax and the $16,000 annual gift tax exclusion (in 2022) confuse nearly everyone. The bottom line is that in early 2022 you can give away way more than $16,000 without paying gift tax. In fact, most people could give away every penny they have and still not pay gift taxes. Here’s some tips on how to give away assets without paying gift tax. In early 2022, you can give away $16,000 per calendar year to as many people as you’d like. The annual gift tax exclusion is unlimited, … [Read more...] about A Primer on Gift Taxes in 2022
