Estate Planning

What keeps you up at night? Security in Estate Planning

I have a husband, three kids, and two pets.  I love all of them and I want to do everything I can to keep them healthy and safe.  I buy organic food.  We drink filtered water.  We wear sunscreen.  We avoid BPA, the chemical used to make certain plastic products.  When purchasing personal care products, I try to choose ingredients and formulations that are not harmful to our health.  I’ve read up about clean beauty, and I try to avoid endocrine disruptors.  I look for non-toxic home cleaning products for my kitchen, bathroom, and laundry room.  I avoid harmful pet products and I use lawn products that are safe for pets.

We keep a baseball bat by the door.  We have a watchdog.  We have a home alarm system. I have a taser.  And bear spray.  Earlier this year I attended a women only shooting event where we learned self-defense and how to safely use handguns and pepper spray.

All that said, the most important thing that I have done to keep my family safe is my estate plan.  Specifically, my incapacity plan.  Most people think that an estate plan is a bunch of legal documents that say what will happen to your stuff when you die.  This is true.  But to me, the most important part of the estate plan is where you say what will happen if you don’t die.  Imagine this, you and your husband are in a terrible car crash on date night.  You are both in a coma.  Your last will and testament says who gets your assets and who will raise your children if you both die.  But who takes care of them if you are alive, but in the hospital, incapable of making decisions?  And who is authorized to take control of your financial and medical decisions until you are able to do so yourself? There are three basic legal documents that typically make up the incapacity plan – the living will, the HIPAA Authorization, and the Power of Attorney.  If you are looking for the best Montana estate planning lawyer, you’ll want someone with experience. It may be in your best interest to contact an experienced Montana estate planning attorney to discuss the particulars of your specific situation.

The living will is a legal document that gives the person you select the authority to make life-sustaining and life–ending decisions for you if you become incapacitated.  The HIPAA Authorization gives your doctor or other health care provider the authority to disclose your medical information to the person you select.   Remember Terri Schiavo.  Terri’s husband argued that Terri would not have wanted prolonged artificial life support and elected to remove her feeding tube.  Terri’s parents argued in favor of continuing artificial nutrition and hydration.  The highly publicized and prolonged series of legal challenges presented by her parents caused a seven-year delay before Terri’s feeding tube was ultimately removed.  A HIPAA Authorization and a living will that clearly expresses your wishes could help you and your loved ones avoid a situation like the Schiavo case.

The Financial Power of Attorney is a legal document where you give someone else the authority to make financial decisions for you.  For example, you could give them the authority to pay your bills, manage your investments, file your tax returns, mortgage and sell your real estate, and address other financial matters that are described in the document.  Financial Powers of Attorney come in two forms: “Durable” and “Springing.”  A Durable Power of Attorney goes into effect as soon as it is signed, whereas a Springing Power of Attorney only goes into effect after your are determined to be mentally incapacitated.

The key to remember is that your incapacity plan must be in place before you are incapacitated.  So, don’t delay!  Before heading out on date night, protect your family and get these legal documents properly drafted and signed.  It is worth it.

Matrium Law Group PLLCThanks to our friend and blog author, Lili Panarella of Matrium Law Group PLLC for her insight into the estate planning practice.

estate planning lawyer sacramento ca

Estate Planning For New Parents

Just started a family or planning to have a child soon?  While there are most likely a lot of things on your mind, one of the last things on the list (if it’s even there!) is probably estate planning.  However, it is absolutely crucial to begin estate planning if you’re a new parent.  Here are the top items to consider and reasons why estate planning is critical:

Nominate a guardian for your children.

Perhaps the most important of all, with minor children, you’ll want to to carefully consider who you would like to take care of your children should anything happen to you or your partner.  If you won’t name a guardian, the courts will appoint one in your absence; while they will try their best at nominating the best one they see fit, their decisions may not align with yours.  

There are a variety of factors to consider, as this person, ultimately, would be the one to raise your children.  Would they be able to financially care for your child?  Are they in good health?  Are they supportive?  Will your kids have to relocate?  And, of course, you’ll need to have a conversation with that person if they would even want the role, as it is a huge responsibility.

Creating trust accounts for your children.

By determining how you want your assets allocated in your will, you may prevent your heir’s inheritance from being in a court-controlled locked account.  Like a guardian, you can nominate a trustee, who will manage the funds, and ensure the money goes to things you believe are important, such as education, health, etc.  You can also determine at what age your child will gain full control of the assets in the trust; you may want to allow them to have the lump sum at 30 rather than 18.

Set up a durable power of attorney for both financial and medical decisions.

Should you become incapacitated, a Durable Power of Attorney appoints a person of your choosing to make financial or medical decisions on your behalf.  These can be two different people as these are separate realms of responsibility.  If you have not set up a durable power of attorney, the court will appoint a guardian for you.

Estate planning may sound like a daunting task, but your loved ones and children will thank you for it.  Hiring an experienced and knowledgeable attorney can put your mind at ease and help you finalize your documents.  

Contact Yee Law Group if you’d like to begin your estate planning process, either by filling out a quick contact form here, or calling our office at 916-927-9001 for a free consultation.


What Should I Know About Estate and Inheritance Taxes?

While the term inheritance tax and estate tax are often used in an interchangeable manner when referring to the collected tax after someone dies, these terms have very different meaning. Therefore, let’s look at the differences between inheritance tax and estate tax.

Estate Tax

An estate tax is a type of taxation on a deceased’s property after they pass away. It’s calculated based on the property’s net worth as it was valued during the deceased person’s lifetime. In some states, the estate may qualify for a state tax exemption for both non-residents and residents who owned that property prior to their passing. For example, these exceptions range between $340,000 and $675,000 in Hawaii and Delaware. In other states, it’s possible to have as much as a $1 million exemption. Check with a tax attorney or accountant to verify how an estate tax will be calculated for the property you own or will inherit.

Inheritance Tax

This is a type of death tax that is paid by the person who inherits the property. The estate tax is based on the value of the property that they inherit. The net value is payable after tax exemptions and deductions are applied.

Transfer of Property

In states where inheritance tax is collected from the surviving spouse, they may be exempted from paying taxes on property that they inherit. Check with a tax attorney to see if this applies in your case. In several states, when property is transferred to the deceased’s surviving children they are not subject to paying inheritance tax on those properties.

Your Responsibilities as the Executor

If you were named as the executor of an estate, either because you were appointed by the court or you were named as such in the will, you have certain legal responsibilities.

  • One of the first orders of business is to determine what assets the estate has at its disposal to pay any outstanding debts of the deceased.
  • It may be necessary to liquidate some or all of the estate’s assets in order to fulfill the debt obligations. Debts may also include funeral expenses.
  • After all debts have been paid and the probate process is complete, you will have to disburse the assets to the heirs named in the will. If one or more heirs are minors, in most cases they are not eligible to receive those assets until they become of age. In the interim, you will have to set up a trust to hold those assets on their behalf. A tax attorney or estate planning attorney Scottsdale AZ trusts can assist you in this. He or she can also make sure that the trust is set up in such a way as to minimize the amount of taxes that the young heirs will have to pay once they come of age.

Tax inheritance rates vary from one state to another. The tax rate is also affected by the relationship of the heir to the deceased. In nearly every situation, settling an estate and making sure the required tax obligations are met is more easily handled with the help of an experienced accountant or estate planning attorney.

Hildebrand LawThanks to our friends and contributors from Hildebrand Law for their insight into estate planning practice.

Don’t Lose Your Savings to Long Term Care Costs

America is aging, and as we get older, more and more of us have health problems that require long term care.  Usually when we think of healthcare, we think of acute care meant to cure or treat a specific illness or ailment, like taking medicine, performing surgery, or receiving treatments over time.  By contrast, long term care is care over an indefinite duration for people who cannot take care of themselves due to physical ailments, such as a severe stroke, or mental ailments, such as Alzheimer’s disease or dementia.  Caretakers often provide custodial care – looking after the person – and help with basic activities of daily living such as eating, bathing and moving around the person’s living space.
Long term care can be provided in several settings:  in a nursing home, an assisted living facility, or at home with home health aides.  The problem with all of these settings is that long term care is very expensive.  In New Jersey, nursing homes typically cost more than $10,000 per month.  Prices are cheaper is some other parts of the country, but still very expensive.  Likewise, assisted living facilities (which provide less intensive care than nursing homes) typically cost around $8,000 per month.  Licensed home health aides often cost more than $20 per hour, which can add up if a person needs full-time care every day.  (Family members can provide long term care, but that often takes a toll and becomes unsustainable over time.)
How do people pay for long term care?  If a nursing home costs $120,000 per year, even a family that has saved significant funds will quickly deplete their nest egg, leaving their spouse impoverished and heirs bereft.
Fortunately, the government will pay for nursing homes and other long term care through Medicaid.  Medicaid is a public benefit program, funded in part by the federal government and administered by each state, that provides healthcare to people.  Medicaid can pay for the full cost of nursing home care, after the person’s income is applied.  However, to qualify for Medicaid’s long term care benefit, you must meet strict eligibility requirements.  Applicants usually must have less than $2,000 in qualifying assets (called resources), must have limited income, and must meet stringent medical requirements.
There are opportunities for Medicaid applicants to preserve assets within their families while qualifying for Medicaid.  Those opportunities are complex – Medicaid has strict rules with which applicants must comply.  If a Medicaid applicant makes gifts within the five year look-back period before applying for Medicaid, the applicant is penalized for those gifts.  So applicants cannot simply give all their money away and then go on Medicaid.
However, there is room within Medicaid’s rules for Medicaid planning in order to preserve wealth and assets for family members that otherwise would have to be spent on long term care costs.  Medicaid planning may involve a trust, annuity, structured gift, exempt purchase, or other technique, with the goal to realize value from property that otherwise would be lost to care costs.
If you’re interested in Medicaid planning, you should speak with an elder law attorney familiar with Medicaid’s complex rules.  The National Elder Law Foundation (NELF), accredited by the American Bar Association, maintains a directory of Certified Elder Law Attorneys (CELA’s, certified by NELF) in every state.  The National Academy of Elder Law Attorneys (NAELA) also maintains an attorney directory.
If you or a loved one may need long term care in the future, it is a wise idea to consult an elder law attorney for guidance on your options.
Thanks to our friends and contributors from FriedmanLaw for their insight into elder law, special needs and trusts and estates law.

Will a personal injury award affect my taxes?

Reaching a favorable settlement in a personal injury case with the help of a personal injury attorney Atlanta GA relies on can be a huge victory. Such a win can give you the compensation you need in order to recover from your injuries without worrying about how to pay for them. However, a personal injury award can have a significant impact on your taxes.

If you pay taxes on your personal injury award is determined by what kind of award you receive, and the size of the award may determine the amount that must be paid.

If the award was for punitive damages, which are damages ordered to punish the party responsible for your injuries, the IRS will view it as income. This means that it will likely be subject to an income tax, but the exact amount you will owe is variable based on the size of the award and other personal details of the case. Similarly, an award for lost wages may be taxed because it is intended to compensate for salary lost as a result of the accident. Since these wages would have been taxed had they been earned, it makes sense for them to be taxed when compensated.

Compensatory damages are seen slightly differently under tax law. Compensatory damages are designed to reimburse victims of an accident for any direct expenses that resulted from someone’s negligence. Compensatory damages can include medical expenses, property repairs, and other tangible costs. In most situations, awards for compensatory damages will not be taxed, as they are not income and should not be any more than the bills they represent. An exception to this would be if the victim received a tax deduction for these expenses. However, if the amount awarded for compensatory damages do exceed the value of damaged or lost property, they may be taxed on the extraneous value as income.

As you can surely tell, there is no simple answer to how awards in personal injury cases will be taxed. For a complete understanding of how much of your award you will owe to the government, if any, contact an experienced tax attorney. An skilled tax attorney will be able to apply the intricate tax laws of your state and the federal government to your case, and determine exactly what you should expect.

logo.fw_Thanks to our friends and contributors from Andrew R. Lynch, P.C. for their insight into the effects of a personal injury award on taxes.

What Does Probate Mean?

“Probate” is the term given to the process by which a will is dealt with in a court of law. During the time a will is in probate, an individual is named as the executor of the estate. This means that they are tasked with the responsibility to administer the estate which includes distributing the assets to those  named in the will or to the heirs.
Assets will enter probate if:
  • They are to be distributed according to a will.
  • There is no will or alternative form of ownership.
Assets that are not subject to probate are:
  • Any properties that were jointly owned.
  • Life insurance that has specifically named beneficiaries.
  • Assets that are belonging to an established living trust.
What Is the Importance of Probate?
Many people like to avoid having their will subject to probate for several reasons.
  • Because probate cases are of public record, anyone who would like access to the financial records of the family will have that access as they will be able to review any court records.
  • The probate process often involves an attorney which can be an unexpected expense.
  • The cost of probate itself can be high, as much as 5% of the estate’s value. This price will vary based on the complexity of the case.
  • The probate process can be lengthy.
  • During the time the will is in probate, no heirs will have access to any assets that they inherited.
  • The probate process often takes more than six months to complete.
Estate Planning to Avoid Probate
The process of estate planning is complex, and not one we want to think about. There comes a time, however, when we all need to work through end of life planning. A Peoria IL probate attorney may be able to help in planning for this type of occasion. Ensuring that you have adequately planned your estate not only provides you with a sense of relief but also eases the strain on your family when they are left to handle your estate.
It is possible to work ahead of time to reduce the portion of an estate that will be subject to probate. A few ways to do this are:
  • If you have real estate, consider a joint ownership with the person who you will give it to after you pass. The full title can then be transferred directly to that person, thereby avoiding probate.
  • Name beneficiaries for retirement plans and IRAs to keep these assets out of probate.
  • Create a “revocable living trust.” This is a trust you create while you are still alive. It is revocable and you can amend it as needed.
The Advantages of a Revocable Living Trust
There are many reasons for why such a trust is a popular choice for estate planning.
The trust clearly designates individuals and clearly describes how any assets are to be distributed and handled.
  • Your assets are put into the trust which you will be in charge of. You will be responsible for reporting any income of the trust on your yearly individual tax return.
  • Upon your death, the assets contained in the trust will be distributed as you have previously dictated.
  • A living trust works very similarly to how a will works, with the important difference that a trust is not subject to probate.
The goal of avoiding probate is just one of the many complex issues that can make estate planning a complicated process. However, ensuring that your estate is properly managed and cared for can be simplified with the assistance of an estate planning professional. Enlisting the aid of a professional is especially important if your estate is complex, or large.
smithweerlogo_75Thanks to our friends and contributors from Smith & Weer, P.C. for their insight into Probate Law.

3 Reasons Why Every Parent Needs A Will



If you have children, it is imperative that you write a will.  If you don’t, and pass away without a will, state law will decide what happens to your property and who will take care of your children.  Having a will already in place to protect your kids and property will ease your mind should anything happen, but in case you need more of a push, here are 4 reasons to create a will when you have children:

1. You get to decide who takes care of your kids after you pass, instead of the state.
Would you want to leave it up to strangers to decide who will raise your children once you’re gone?  This is what will happen if you don’t leave a will designating a guardian.  Although the courts will try to do what’s best for your children, you won’t get a chance to weigh-in your opinion unless through a will.  It’s not an easy choice to make, but it is incredibly important for the wellbeing of your child.
2. You decide who will look after your child’s finances and manage your property.
You can name the same person as their personal guardian, or you can choose someone different.  This may be important if you think one person would be a better parent, but another has a greater hold on finances and management.
3. You can determine who gets what.
Whether you want your property split between your children evenly or not, this one is crucial.  There may be some things that seem easy to split, but others such as cars, furniture, or jewelry, you will want to decide who specifically gets what.  You can also decide to leave someone nothing, and that must be stated, otherwise they may be able to claim a portion of your estate.

While creating a will may seem like you’re accepting something bad may happen to you, it’s much smarter to be proactive and ready, and leave your family with a plan of your best intentions.  You may want to speak to an experienced wills lawyer Sacramento CA respects to review your options and set up a will or trust today.

Why Do You Need A Trust?

Clients often ask what determines whether they will need a basic will or a trust. These are some of the suggestions I give as a estate planning lawyer Phoenix AZ relies on:

Will You End Up In Probate?

My first question is always, “Are you comfortable with your estate going through probate?” Every estate and client is different, the type of assets are different and the parties involved are different.

For some people the idea of dealing with the court, making court filings and following specific timeframes seems daunting. Some states can have easier processes or more informal probate proceedings, but it can still seem like a tough task. In some cases, a probate may even make sense, there may be a comfort in knowing that the court is involved to make sure things are completed.

Are there people you wish to protect or have assets managed on their behalf?

For clients with minor children, special needs individuals, dependency issues or other challenges, it may be critical to not leave them with direct control of assets. Clients needs to know that without putting a trust together and identifying trustees of their choosing, they will be leaving it up to the court to decide who will be appointed conservator over assets.

Just as one consideration, not using a trust could in an ex-spouse being appointed by the court to be in charge of assets for a child.

What Are Your Assets Like?

Do you have assets in multiple states? Do you have a business? The complexity of the assets can have bearing on whether a trust makes sense. If there are assets in multiple states, a will plan would require probate in multiple states. If there are business assets, there may be a need to maintain seamless continuity to prevent damage to the business. In other cases, a family may wish for assets to remain in a family. For that, a trust would make sense to allow for a long term plan of operation.

What Time Period Are You Planning For?

A will only has a use after someone passes away. Even if they were on their deathbed it would have no function or ability to give authority over assets. If it is important to a client that management be consideration not just for death, but also in the event of incapacity, then a trust would be right vehicle to give authority and responsibility over assets.

Thanks to our friends and contributors from Kamper Estrada LLP for their insight into the trusts and estate planning practice.

Who is Obligated to Participate in a Deposition?

Depositions are an important part of many trials, and there is a lot to understand about their process. If you will be participating in a deposition, or your lawyer is conducting a deposition for your case, then it may be helpful for you to have a general understanding of what will be involved.

What Is a Deposition?

A deposition is the oral testimony of a witness and takes place out of court, usually in a lawyer’s office. The witness’ testimony is documented in writing and can later be referred to in court by either party. A deposition is also called an examination for discovery, or an examination before trial.

  • A deposition is where the attorneys gather information in preparation for the trial.
  • Both attorneys are allowed to ask questions of the witness.
  • The witness must answer aloud, as a recording won’t record a nod or any facial recognition.
  • After the first attorney has asked their questions, the second attorney will have their chance to ask questions in cross-examination.
  • There is a limit of only ten depositions of various witnesses per side allowed.
  • A deposition can only last for seven hours in one day.

Who Is Usually Present in a Deposition?

There are certain people who are almost always present at a deposition. This includes the court reporter to provide the transcription and deposition services and at least one lawyer for each side. There are no limitations on who can attend the depositions unless there is a protective order in place.

  • If there is someone that you don’t want at the deposition, the burden is on you to prove “good cause” for why they shouldn’t be there, according to Federal Rule of Civil Procedure 26(c)(1)(E).
  • Good cause entails that the order is required to protect the person from oppression, embarrassment, undue expense or undue burden.
  • This is different from a trial, where a witness can be excluded as requested by the party.

When is A Deposition Necessary?

This usually depends on the circumstances and various facts of the case. If the case hinges on proving certain circumstances and the details of what happened, a deposition is a common part of the discovery process. Sometimes, the information obtained from the deposition opens the door for a settlement to take place. A settlement agreement negates the need to go to court and can be a cost and time savings. If you would like to know more about what you’re likely to experience in a deposition for your case, consult your attorney. If you do not have an attorney, contact a law firm as soon as possible.

Thanks to our friends and contributors from Veritext for their insight into depositions

What Is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?

Bankruptcy refers to a federal law that helps people or companies get out of debt. Individuals who need to file bankruptcy may qualify for either a Chapter 7 or Chapter 13. Both types of bankruptcy just refer to chapters, or sections, of the bankruptcy law.

If you’re overwhelmed with debt, you may want to know the difference between Chapter 7 and Chapter 13 bankruptcy before you decide how to file. The best option depends on your specific situation.
When to File Chapter 7 Bankruptcy
Chapter 7 bankruptcy forgives your debts without requiring you pay the balance. It also stops wage garnishment and creditor harassment.
Many people choose Chapter 7 bankruptcy when they are current on their home or car payments, but can’t possibly pay other types of debt. Those debts could include:
  • Credit card debt
  • Medical bills
  • Utility bills
  • Money owed on an apartment lease
  • Payday loan debts
  • And more
Chapter 7 has a lot of advantages. It frees you from debt very quickly, and it doesn’t come with a lot of obligation. But it also isn’t designed to protect your assets. That’s where Chapter 13 comes in.
When to File Chapter 13 Bankruptcy
Chapter 13 bankruptcy helps you get out of debt while still protecting your assets. It stops wage garnishment and creditor harassment, just like Chapter 7, and it also stops foreclosure and repossession.
Many people choose Chapter 13 when they have some income but are behind on their home or car payments. Because it has the force of federal law behind it, Chapter 13 instantly stops creditors from taking someone’s property.
During a Chapter 13, your attorney works with the courts and your creditors to set up a reasonable payment plan for your debts. They design it around your specific financial situation, so you can follow the plan without falling behind. At the end of your bankruptcy, you will be current on your home and your car will be paid off.
Deciding on the Right Type of Bankruptcy
As a Memphis bankruptcy attorney, I’ve found many clients don’t know exactly which type of bankruptcy they need until they speak with a bankruptcy lawyer. A qualified and experienced bankruptcy attorney will talk with you about exactly what debts you have and what your priorities are. They will help you figure out whether you qualify for each type and what you would need in order to file.
Look for an attorney with a free consultation who has experience with the type of bankruptcy that interests you. Make sure they don’t charge extra for complications that may come up.
And finally, whichever bankruptcy type you end up filing, remember both offer the chance to get a fresh start and rebuild your financial life. Chapter 7 and Chapter 13 have that in common, so don’t be afraid if one turns out to be better for you than the other.

Thanks to our friends and contributors from Darrell Castle and Associates, PLLC, a Memphis-based bankruptcy and personal injury law firm dedicated to helping people in the Mid-South get through hard times when they happen.