In the fall of 1990, some thirty-four years ago, your writer first heard of the proposition that if you set up a living trust your estate doesn’t have to go to court to settle – the so-called probate court proceeding for wills. Having spent the previous eleven years as a…
In second marriage planning, a co-trustee is sometimes recommended on the death of the first spouse. While both spouses are living and competent they run their trust or trusts together. But when one spouse dies, what prevents the other spouse from diverting all of the assets to their own children?…
Revocable living trusts, where the grantor (creator) and the trustee (manager) are the same person, use the grantor’s social security number and are not required to file an income tax return. All income and capital gains taxes are reported on the individual’s Form 1040. Irrevocable living trusts come in two…
By now most people know that trusts avoid probate which is required with a will — if there are “probatable” assets, in other words those in your name alone. While many assets can be set up to avoid probate by putting joint owners on or by naming beneficiaries, titles to…
For the ever-increasing number of those who become legally incapacitated later in life (i.e. unable to handle their legal and financial affairs) having a legal guardian appointed looms as a distinct possibility. A guardianship proceeding may be commenced by a hospital, nursing home, assisted living residence, family member or a…
If you’re creating a plan for what will happen to your estate after you pass away or become incapacitated, you’ve likely familiar with the advantages you can realize by creating a living trust. Items positioned in a trust do not pass through probate, which can be a costly and time-intensive…
PROPOSAL TO MOVE BACK TO PREVIOUS TRUST LAWS As this blog discussed in the recent past, dynasty trusts are trusts that allow for a benefactor to pass wealth on to future generations via various legal mechanisms that allow a trust to carry on for literally hundreds of years, overcoming the…
VERY SIMPLE CONCEPT This blog examined the dynasty trust in the past but it is time to reexamine certain aspects of the dynasty trust. The dynasty trust is a trust designed primarily to avoid the generation skipping transfer tax when a person wants to leave money to their grandchildren or…
STRANGE NAME, GREAT CONCEPT A person is entitled to gift up to $14,000 per year without incurring any gift tax liability. There are some limitations to those gifts, however. The gift must be for the unlimited, present usage of the interest that is being conveyed. That creates problems for when…
529 ACCOUNTS Estate planning is the legal strategy by which one generation transfers wealth to the next, which involves an the use of various trusts and/or a will or even transferring money or items to corporations in an effort to legally and ethically reduce tax liability. One of the easiest…