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WHO NEEDS ESTATE PLANNING?

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Many people assume that they do not need estate planning. The truth is everyone needs estate planning! No matter what your life experiences, if you are over the age of 18, you need planning. Take a look at the following list of people who benefit from the use of estate planning. Speak with an estate planning attorney today!

  • Families who have young children
  • Young couples who have just gotten married
  • College students
  • Individuals who want to provide for their loves ones
  • Young professionals who are just beginning their career
  • Families with adult children
  • Individuals with few assets
  • Individuals with extensive assets
  • Retired individuals
  • Couples who are expecting a child
  • Individuals who have preferences about their funeral arrangements
  • Seniors who have recently lost a spouse
  • Individuals who do not have life insurance
  • Recently divorced individuals
  • Couples who have recently adopted a child
  • GLBT individuals
  • Individuals who want to make important medical decisions ahead of time
  • Veterans of the Armed Forces
  • Elderly couples
  • Individuals who own a business
  • Couples who have become separated
  • Same sex couples
  • Individuals with disabled family members
  • Individuals who want to donate to a worthy cause
  • Grandparents who want to make a difference in their grandchildren’s lives
  • Individuals with life threatening illnesses
  • Families who love their pets
  • Parents who want to make sure their children are cared for no matter what
  • Individuals who want peace of mind

As you can see, everyone needs estate planning. With the help of an estate planning attorney, you can invest in a plan that will meet your individual goals. Take the steps needed to prepare for the future today!

If you have any questions about the estate planning process, consult with a qualified estate planning attorney

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JOIN US FOR A FREE WORKSHOP THIS WEEKEND TO LEARN THE FOLLOWING:

Elder Law and Medicaid Planning

Medicaid needs arise when you least expect them. Americans are living longer than before. At the turn of the 20th century, life expectancy was about 47 years. In the 21st Century, life expectancy has doubled. As a result, we face more challenges and transitions in our lives than those who came before us.

PROTECT your life savings.
INCREASE the amount of income of keep.�
AVOID losing your home.
REDUCE or ELIMINATE your nursing home bills and long term care costs.
LEARN about Veteran’s Benefits.

Wills, Trust and Estate Planning

We know you want to pass your wealth to whom you want, when you want, the way you want, at the time of your death. If done correctly, a Estate Plan can help minimize estate taxes for a married couple and allow a trusted person to take over your care and finances during incapacity.

PROTECT your family.
AVOID probate delays and expenses.
SAVE estate taxes. Give your money to your family.
PRESERVE money for children or charitable causes.

Join us at our FREE Workshop this weekend. Our experienced attorneys will give you the information you need.

To register for the seminar, call our office at (718) 793-7000 , or register online!

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Estate planning takes a team effort. This is the perfect idea to plan and schedule important meetings at the same time. This includes scheduling meetings with an estate planning attorney, insurance professional, CPA, and financial advisor. If you take the time to schedule these meetings over the next few weeks, you will be well on your way to beginning to creating the future you want.

1. Don’t let fees stand in your way.

Estate planning works well with the help of other professionals.

While professional fees can be a big concern, this is something that shouldn’t stop you from proper planning. The truth is, you will likely be offered a free or low-cost initial consultation with an estate planning attorney.

Even if you have to pay the attorney’s hourly fee, it is a worthwhile investment.

A CPA will charge by the hour, so fees will depend on your specific needs.

Both insurance professionals and financial advisors are paid through the products that they sell. You will most likely not have to pay a direct fee for their time.

2. Many people need an estate planning attorney and advisors.

Many people assume that only the rich need an estate planning attorney and advisory team. The truth is, everyone needs estate planning and many people can benefit from a team of advisors.

Feel free to ask your estate planning attorney if you are unsure whether you need an advisory team.

3. Be honest and share all information with your attorney.

If you fail to disclose assets to your estate planning attorney in order to avoid paying legal fees, there could be problems in the future.

For example, after you die, you may suffer a loss to state or federal taxes.

By sharing all information and assets, your attorney will be able to create a proper estate plan. You should always be genuine with your professionals.

4. Follow these guidelines when planning meetings:

  • Meet with your estate planning attorney every three to five years. If a law changes or you experience a significant life change, you may need to meet with your attorney sooner.
  • Meet with your CPA twice a year or as recommended.
  • Check in with your financial advisor quarterly.
  • Check in with your insurance professional on a yearly basis.

Call a qualified estate planning attorney and make advisory appointments. This will allow you to have several professionals looking out for your future.

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There are different ways to own property. It is important to understand how each form of property ownership affects your estate plan. Knowing how each ownership impacts your estate plan, can allow you to make better estate planning decisions. Below are descriptions on the three main ways to own property.

Individual Name

  • If you are not married, most of your property will probably be owned in your name.
  • Examples of property with individual ownership include your mortgage deed, car title, and insurance and investment accounts.
  • Assets that are owned by you, individually, are controlled by your will. This guarantees probate.

Joint Ownership

  • Most married couples have most property owned in joint names.
  • Joint ownership is not only for married couples. This can be used with siblings or with an elderly parent and his or her children.
  • A mortgage deed and investment accounts would name two names as owners and say as “joint tenants with right of survivorship.”
  • Both owners have 100% ownership.
  • Jointly owned assets are not controlled by your will or trust. This could lead to unintentional problems such as disinheriting a child.

Tenants in common

  • Tenants in common is a form of ownership that allows two people to own a property, but each person owns a specific share. Each person is able to sell his or her own share.
  • A rental property that lists two people as tenants in common gives each person a 50% ownership (usually.) Each owner is able to sell, devise, or give away his or her share. The other owner will still own his or her 50% share.
  • This type of ownership is controlled by your will. This guarantees probate.

If you have questions about property ownership and how it impacts your estate plan, consult with an experienced estate planning attorney.

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Along with authorizing organ donation with the use of a donor card (often your driver’s license,) you can state your organ donation wishes in your estate planning documents. This can be done in a separate organ donation form.

Take the following things into consideration when considering implementing organ donation into your planning.

By donating organs and tissues, you can help contribute to medical advances as well as save lives.

The following organs are tissue transplants are common:

  • Liver
  • Heart
  • Skin
  • Kidney
  • Lung
  • Bone
  • Connective tissue
  • Pancreas

If you want to contribute to medical science and/or save up to eight lives, you may want to include an organ donor form among your estate planning documents.

With proper planning you can do the following:

  • Choose which organs or tissue that you want donated
  • Decide which organs or tissue you do not want donated
  • What purpose you want your donation to have (research, education, transplant)
  • Decide if you want your entire body donated to medical research

Although you have the ability to specify, most folks simply indicate that they are organ donors without restriction.

Should you be an organ donor?

Choosing whether to be an organ donor is your own personal decision. Take some time to think about your own personal beliefs and values. Know that if you choose to be an organ donor you could make a difference in another person’s life and the medical world.

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If you’re like most people, you may not be familiar with the concept of incapacity planning. Incapacity planning is simply preparing for the time that you may be unable or unwilling to make your own day to day decisions. Estate planning encompasses incapacity planning.

When would I be incapacitated?

Incapacity refers to the time when you would be unable to manage your finances, medical decisions, and day to day affairs.

Who determines that I am incapacitated?

A court can make the competency decision during a guardianship proceeding. But, guardianships are expensive, time consuming, public, and stressful. This process, called “guardianship” or “conservatorship,” is required if you do not have appropriate incapacity planning in place.

It is preferable to have a private determination such as by a “disability panel.” You give instruction for the creation and implementation of such panel in your revocable living trust. The panel typically includes trusted family members and medical professionals.

So, I need a revocable living trust to prepare for incapacity?

In almost all cases, it would be beneficial to have disability provisions in a revocable living trust, financial power of attorney, and health care proxy. This is the three prong approach to incapacity planning.

In the revocable living trust, you provide for the determination of your disability, name disability trustees, and give instruction for your care and the management of your assets during any period of disability.

I need a power of attorney and health care proxy?

You need a financial power of attorney so your named agent can manage your assets and financial affairs and take care of your day to day business. The agent under a financial power of attorney should care about you, be highly organized, a good record keeper, and a good communicator.

You need a health care proxy so that your named agent can make health care decisions for you if you are not able to make those decisions yourself. The agent under a heath care proxy should care about you and have the ability to be assertive with medical professionals, especially doctors.

If you have any questions about incapacity planning, consult with a qualified estate planning attorney.

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If you’re like most estate planning clients, you have lots of questions. Here are answers to some of the most frequently asked estate planning questions.

What is asset protection?

“Asset protection” means assets cannot not be taken by a creditor in a lawsuit. You can provide asset protection for the assets you pass to your beneficiaries by passing them in a carefully structured trust, as opposed to outright.

Do I need life insurance?

You may need life insurance if you:

Have loved ones who are dependent upon your income
Want to create an estate
Want to equalize an estate
Need to pay federal estate taxes
Need to fund a buy-sell agreement
How do I pay for a nursing home?

If you need nursing home care, there are four ways to pay for it:

Private pay
Long term care insurance
Medicare (extremely limited)
Medicaid (if you qualify)
Pre-planning is highly recommended. The earlier you plan for nursing home care, more options and lower fees will be available.

My sister and I want to set up a small business. What legal entity should we use?

You and your sister should consult with a qualified estate planning attorney about your specific situation. But, in general, the limited liability company (LLC) is a good entity for a small business.

The LLC has the liability protection of the corporation (without the double taxation.) And, the LLC has the tax simplicity of a partnership.

In addition, it is inexpensive to set up and to run.

What is incapacity planning?

Incapacity planning (aka “disability planning”) provides for your care and management of your finances should you become incapacitated and unable to take care of these matters yourself.

If you have further estate planning questions, read FAQ: Estate Planning (Part 1) and consult with a qualified estate planning attorneys.

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Many people know that they want to avoid probate, but don’t understand the benefits of doing so. “Probate” is a process in which a court validates a will. In addition, the entire process of administering an estate is called a probate.

Probate can be an expensive and long process, so if you are like most people, you will want to avoid it.

Jointly Owned Property

Jointly owned property avoids probate. An example of this is when a married couple owns a home together. With jointly owned property, there is no need for probate because the property is automatically transferred to the other owner once someone dies.

It is important to speak with an estate planning attorney to decide if joint ownership is a good idea for your personal situation.

The Revocable Living Trust

Many people use the revocable living trust to avoid probate. This makes the trust become the main focus of an estate plan instead of the will.

In order to avoid probate, it is imperative that your revocable living trust be fully funded.

This means that your assets will be in the name of your trust.

Gifts

A great way to avoid probate is by making sure property is not yours when you die.

However, make sure that you only gift things that you do not need.

It can be a great experience to see your loved ones enjoy your gifts during your lifetime.

If you give away more than $13,000 per year per individual, you will be required to file a gift tax return. Married couples are able to gift up to $26,000 per year.

Contract Property

Another way to avoid probate is by naming an individual as a beneficiary of your contract assets. This includes retirement accounts and life insurance, payment on death (POD) accounts, and transfer on death (TOD) accounts.

If you name your estate, probate is required.

It is important to speak with an estate planning attorney to decide if POD or TOD accounts are a good idea for your personal situation.

If you have questions about the probate process and how to avoid probate, consult a qualified probate attorney. He will professionally guide your throughout the entire process.

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Roth IRAs have wonderful benefits:  tax free growth and tax free distributions.  So, when you have the opportunity to convert assets from a traditional IRA to a Roth IRA, should you make the conversion?

Here are some considerations that will help you to decide:

  • Zero tax bracket:  If a full conversion or partial conversion can be offset by deductible losses (i.e. business losses, mortgage interest, student loan interest), the conversion makes sense because it is free.  No additional tax dollars will be assessed and you are converting assets that will be distributed with taxes due into assets that will be distributed without any taxes due.  Converting after tax traditional IRA assets would also be available at no cost.
  • Higher future taxes:  Paying taxes today may make sense if you think income tax rates or, at least your personal income tax rate, will rise in the future.  You are also eliminating taxes on all future growth.
  • No RMD:  If you won’t need the required minimum distributions from your traditional IRA, it may make sense to convert to a Roth IRA to take advantage of continuous tax free growth and tax free distributions for future generations.  Unlike the traditional IRA, the Roth IRA does not have required distributions.
  • Asset protection: IRA and Roth IRA assets are protected from bankruptcy proceedings and lawsuits (i.e. malpractice claims.)  Assets outside the IRA can be used to pay the taxes on the conversion, thereby reducing non-protected assets and maintaining asset protected assets.
  • Diversification:  Because the tax code is ever changing, it may be wise to divide your assets between non-retirement investments, traditional IRAs, and Roth IRAs.

If you have questions about retirement planning, traditional IRAs, Roth IRAs, and Roth conversion, be sure to consult with a qualified estate planning attorney.

Davidov law Group is a member of the American Academy of Estate Planning Attorneys.