Category: Estate Planning

 Being the parent of a child with special needs requires careful planning and consideration of the child’s future. It’s important to know many children with special needs often live full lifespans. Knowing that you are likely to precede your child in death is a good opportunity to plan ahead and set up a structure to help support them well into the future.

One way that parents can do this is by being an advocate for the child’s education. This is a mandated right until age 21. As a parent you have the opportunity to help secure and monitor all available services with regard to education for your child. In addition to focusing on all educational opportunities available for your child, make sure that you create a life care plan that addresses housing, financial and medical needs. One way to do this is through the creation of a special needs trust.

Additionally, you may want to consider the possibility of appointing a guardian to help the child manage assets within a trust or other structure. If the child’s capabilities permit it, the child could also be involved in authorizing an agent to assist with the process of planning for a financial future. If necessary, life insurance can be a good supplement to help you. Finally, create a letter of intent that conveys all of your aspirations for the child so that a future guardian or healthcare assistant can understand your perspective.

 

When a family member is looking at the need for long term care, it might seem overwhelming because there is so much material to be found about this transition both online and in print. Some of it greatly simplifies the Medicaid process, making it look as though you can easily guide your loved one through qualification.

The reality is that what seems like small mistakes now can end up costing your loved one later in a big way. Attempting to pass on all assets quickly, for example, presents a concern because Medicaid uses a lookback period. This means that your loved one might face penalties if he or she is determined to have tried to circumvent the system in order to qualify for government assistance sooner rather than later.

Medicaid may be a critical component of your loved one’s care, but you need to understand what’s allowed and what’s not. In addition to these basic guidelines, an experienced elder law attorney can give you advice about other strategies that provide the best possible outcome for your loved one. Don’t hesitate to get professional help in these important situations

 

It goes without saying that knowing one estate planning attorney does not mean you know them all. Finding the right mix of experience, expertise, and compassion is important for anyone looking to put together a plan for the future.

In an initial consultation, it’s a good idea to ask for testimonials. Your attorney might have them directly posted on a public forum like Avvo or a business Facebook page, but you can do your own due diligence by asking for contact information of satisfied clients, too. Hiring someone to put together these materials for you or your family is an important task and one that should be undertaken with care. Make sure you consult with others who have engaged an attorney’s services so that you understand how your own needs will be handled.

In the best case scenario, this can highlight just how much value you get from working with the right attorney. In the worst case scenario, it gives you a heads up before engaging in a business relationship that is not the right fit for you.

Family business carries with it a unique set of responsibilities and requirements, and the story of Cloyce Box illustrates that clearly. Cloyce went from having a football career with the Detroit Lions to founding Oklahoma Cement and Box Energy. After raising four sons, Cloyce passed away suddenly in 1993.1

Prior to Cloyce’s death, a ten-year legal battle involved the cement firm and a new marriage presented serious issues. When Cloyce passed, his two brothers, serving in the roles of CEO and Chairman, were unable to get along with other siblings and had no shared vision.

Lawsuits led to an appearance in federal court and the sale of the company for $220 million. While this seems like an exciting tale ending in a good result for the brothers- the resale of the company by the new buyer yielded a price of $1.36 billion. That’s why Brother Doug Cloyce now works as a consultant, warning others with the cautionary tale of his family’s business arc.

It’s not a surprise that people are increasingly mobile these days, and that applies to more than just the online sphere. More clients are coming to us with assets in multiple states, all of which must be addressed properly in an estate plan. 

Rules within states can vary from one to another, so it’s critical to have an estate planning attorney who is looking at the bigger picture. Read on to learn more about the key issues to watch for in this situation:

• Differing inheritance and estate tax rules. These situations can get complex very quickly, so do an evaluation with your attorney to talk about where your assets are at.
• Learn about transfer taxes. Sometimes, pieces of properties will be transferred between spouses or engaged with alternatve gifting strategies. Your attorney can help you understand any income or gift tax consequences associated with these transfers.
• Factor in the potential for multiple healthcare directives. You might need proxies that consider the laws of the states where you spend the most time.
• Plan to avoid ancillary probate. Having property in more than one state can complicate things- talk through your options with your estate planning attorney so that you’re clear about the best options for your situation.

Even if you have the basics covered through a will or other documents, make sure you don’t forget some of the other key aspects of estate planning. If something happens to you, it’s overwhelming and frustrating for loved ones to say the least. Read on to learn more about some of the other aspects you should consider. 

Paying Bills

Are you the one who pays the bills in your house? Your spouse might not even be aware of when the bills are due or how they are to be paid. Make sure to keep a folder of this information so that it can be easily found if something happens to you- a ledger that keeps track of the most recent payments you made is helpful, too.

Copies of Documents

If you already have a will, you probably expect that your spouse will find it. Just in case, however, try to leave a copy of the document with other parties like an accountant or an attorney. This way your spouse can find these critical documents just in case they cannot find the copy you left at home.

Lists of Income, Assets, and Liabilities

If, as mentioned above, you are the one who handles most of the finances, your spouse might not have a complete picture of your financial situation. Try to provide an overview document, stored with the information about paying the bills, so that he or she can visit with a financial planner, accountant, or estate planning attorney to figure things out if something happens to you.

In the wake of grief, your loved one probably already has enough on his or her plate. Planning ahead can make things much easier. Need help thinking through the details? Contact us at info@lawesq.net.

 

A leader’s primary contribution to a company is their availability and vision, this makes it important to plan ahead for maternity or paternity leave. Since the U.S. does not cover extensive paid leave, and only 11 percent of people have it offered through their company, it’s critical to think about how a temporary leave can influence the business.

U.S. laws do permit 12 weeks of unpaid leave with job security, although 40 percent of people do not even qualify for this. Alleviating the stress of the situation is paramount, so planning ahead for what this means for the company owner and the business is a wise decision.

This is also a good opportunity to do a practice run for business succession. A temporary leave that is going to happen anyway empowers individuals with the chance to enhance their management skills and gain a better grasp of what is required while playing a bigger role. It might help to identify people who flourish with this opportunity, but it can be equally useful to determine who struggles with it.

Fostering a culture where all players focus on vision and meeting company objectives is the best way to plan for the departure of a key individual, whether it’s temporary leave or a permanent exit.

Planning can help to save money and efforts spent trying to hire executives from outside the company who may not completely understand the existing culture. To learn more abou planning for business succession, contact info@lawesq.net.

Whether you have just purchased it for yourself or for an aging parent, it’s important to understand the factors involved in a long-term care insurance policy and when it will pay out. Long-term care insurance is a solid option to support or to stand in line with a general healthcare plan.

The term “trigger” refers to an event that activates the need for long-term care, such as difficulty with an activity of daily living or a cognitive impairment. The elimination period refers to the time that a patient must wait before benefits officially kick in. This usually means self-payment for care if some kind of care is absolutely necessary.

Make sure you understand the elimination period so that you or a loved one are not counting on insurance picking up the tab only to learn that self-pay is necessary in the interim. You can learn more about long-term care insurance and other options for planing ahead by consulting with an elder law attorney.

 

A grantor trust means that the person who creates it is still responsible for estate tax and income tax purposes. The grantor also maintains control over the trust, including the income, the benefits, and the assets. Because of this power to control elements of the trust, the owner is also responsible for the income taxes linked to it.

All revocable living trusts are grantor trusts during the owner’s life. An irrevocable trust could even be considered a grantor trust if the owner meets IRS requirements for becoming the official owner of the assets. Depending on the structure, an irrevocable trust could also be set up to split the income taxes from the estate taxes. This is known as an “intentionally defective grantor trust”.

Want to learn more about whether a grantor trust makes sense for your estate planning? Contact us today to set up a meeting.

It is not enough to think only about the people who might take over your business after you have stepped down or passed away- you need to think about the funding considerations that come with such a concern. That’s why funding the plan is an important component of your overall guidelines, and it’s something that should be discussed with your business succession planning attorney. 

Some of the most common issues to consider under this umbrella include:

• Terms of the agreement
• Price
• Future involvement of the seller

When the business transfers from the seller to buyer, all three of these factors should be considered carefully.

If the seller opts to finance the transaction, common methods might include lines of credit, creation of an ESOP, set-aside funds, or insurance. Buyer financing is usually accomplished through the securing of investors or third-party borrowing. Securing investors helps to avoid the need for collateral determination.

Compromise arrangements might be an option, too. This means that the buyer pays a portion of the sale price while leaving the seller with a note for the remaining amount. If you have more questions about planning ahead for business succession, contact an experienced attorney today. Email us at info@lawesq.net.

While your documents might have been in order at the time you created them, shifting laws can change this can cause your well-thought-out plans to miss the mark. Having an ongoing relationship with an estate planning attorney is one of the best things you can do to avoid the challenges associated with the potential for law changes at the state or federal level.

One of the best steps you can take to ensure that your plan is line with current guidelines is to schedule a yearly meeting with your estate planning attorney. This is so that you can review not only whether any changes have happened at the state or federal level, but also so that you can discuss what has changed in your life and how this affects your planning.

Updating documents and naming new beneficiaries might be the most basic purpose of this meeting, but you could discover that there are other opportunities like establishing a trust that are also ideas you might entertain. Contact your estate planning attorney today to learn more.

According to the CNBC Millionaire Study, up to one third of individuals with a minimum of $1 million in assets have not yet engaged a professional for estate planning purposes. While having an estate planner is important for people of all wealth levels, it becomes all the more important when someone has assets above this number.

One of the reasons that people in this bracket tend to avoid setting up a meeting is known as estate planning fatigue. With the nature of federal estate tax laws constantly shifting, most people have already made some effort to update their plans in line with these changes. But the fact that these changes have occurred so often has made some people want to throw in the towel entirely, especially if they have already updated their documents more than once. This is in addition to the fact that it’s relatively well-known that the federal estate tax exemption amount sits at $5.43 million, leading many people to believe that an estate with assets less than that does not need planning.

It’s important to understand that there are benefits beyond tax savings, such as avoiding probate, designating where assets will go, assisting beneficiaries with special needs, and appointment guardians for minors, among others. The three primary barriers that those suffering from estate planning fatigue face are a lack of urgency, the inability to make a decision, and unwillingness to revise an existing plan. Even if this describes you, it is critical to have an estate plan that both reflects your needs and makes the most of current laws and regulations. To keep the updating to a minimum and to meet these goals, set up a minimum of one meeting per year with your planner.

 

We’ve long shared on this blog that estate planning is about more than having the proper paperwork in place. While it is definitely vital to have the right paperwork prepared for your passing, it is just as important to consider the people who will be involved in that process as well. That’s why this unconventional estate planning tip is to take the paperwork one step further and make sure someone knows what to do with it.

Many of the important people in your life are likely to be uncomfortable talking about the subject of death, but at a minimum these individuals must know where to find the documents outlining your plan. There is little value to that paperwork if no one knows where to locate it.

There is a fine line you need to walk between providing people the right information and giving them too much. Perhaps it does not make sense to put your spouse under the stress of maintaining all these documents- in that case, find a trusted estate planner and give them instructions about what details need to be provided to that spouse in the event of your passing.  When leaving details for your spouse, include a business card for the estate planning attorney so your spouse remembers who to contact.

 

 

There is a myth out there that only the wealthiest of entertainers are in need of advanced estate planning strategies. This is not true, because every entertainer could benefit from putting these plans in place before they hit “the big time”. Being skyrocketed into the spotlight highlights the paramount importance of planning, because spending habits and income potential could make these same individuals a target for frivolous lawsuits. 

One of the other issues faced by any entertainer or artist is that there are unique assets. This could include residuals, deferments, or royalties. One tool that is especially helpful for individuals in the entertainment world is the captive insurance company. An estate planning attorney can help you create custom coverage to maximize wealth and minimize taxes.

For entertainers, handing off to heirs can be made more complex by the unique nature of assets like copyrights and trademarks. Life insurance may be another planning opportunity in these situations.

It’s common knowledge that people do better with their health when other aspects of their life are low on the stress scale. Even a perso who suffers from serious illness is likely to combat it more effectively if other issues like health insurance, financial concerns, and legal problems are kept to a bare minimum.

This is especially true for anyone battling cancer. According to recent research, cancer is now the second leading causing of death across the country. It’s anticipated that there will be more than 18 million cancer survivors in the U.S. alone by 2020- this reflects that half of all men and one third of women will develop cancer at some point. Even though survival rates have improved with modern medicine, the costs of dealing with a major diagnosis can take a toll on your emotions, too. Trying to deal with outside issues pulls your focus away from the mental and physical stamina you need to battle cancer or other serious medical issues.  

An elder law attorney, though, can help make non-medical issues easier to deal with, allowing the patient to focus on treatment and recovery. Identifying and obtaining health coverage or assisting with healthcare disputes are two key ways to do this. Qualifying for Medicaid can also be a difficult process in and of itself where an attorney’s guidance becomes all the more important. Having an experienced attorney help you in times of need sets you up for a recovery focused on your needs and not drained by outside problems. Need help? We’ve got you covered: info@lawesq.net.

More than two-thirds of U.S. businesses are currently owned by someone aged 67 or older. This number is growing, too, as ten thousand people per day are turning 65. Against this backdrop, up to three-quarters of companies in the United States will come up for sale in the next 5-10 years. According to UNC’s Business School, nearly two-thirds of companies in that category have not planned yet for the departure of an owner and the organizational change that follows.

Key issues involved in this discussion about ownership shifts include ignoring retirement, failing to plan for the unexpected, not adequately training takeover staff, and a lack of younger managers in the picture ready to be trained for a bigger role. There are also challenges associated with over-valuing the business or assuming that trusted colleagues or family members wish to succeed the departing owner. While this might be the case, it is always valuable to set up a conversation confirming this sooner rather than later so that there are no unpleasant surprises that could halt the flow of business down the road when the owner does depart.

It’s time for a conversation about business succession planning, even if you’re feeling guilt over not having tackled it yet. Contact our offices today to learn more and to set up your meeting. Contact us at info@lawesq.net.

If you want your loved ones to have an easy experience with your estate after you pass away, one of the most popular methods of doing this is by avoiding probate. Leaving as much as possible to your loved ones is possible with some common estate planning methods that can also help avoid costly probate fees. 

A simple living trust can help your loved ones avoid probate and to allow the passage of your property to happen in a relatively smooth manner. In order to create a living trust, you would need a document called a declaration of trust. You’ll put yourself as the trustee, or you and your spouse as co-trustees. At this point, you would then transfer either some or all of your property into the trust. As the owner, you would not lose any control over the items in the trust. You would then name either the organizations or the people you want to receive that property as beneficiaries. With a revocable trust, this is something you can change later on, too.

To learn more about how the living trust can work together with your other estate planning, contact our offices today.

There are some situations where it simply makes sense for a child to buy out a share in the family business. The other option is for the parent to gift shares or to leave shares in a will, trust, or foundation. The challenge is that these same parents might need capital to rely on in retirement, so selling shares in a business to a child is one way to help finance this shift in life.  

In order to do this, an outright sale can be conducted or financing can be arrange. The amount of the total financing depends on several factors like which assets are secured by the business in order to leverage the buyout and what money is currently being borrowed by the business, if any.

There are a few key benefits to buying out rather than waiting to pass on the shares in another way:

• This generates cash for the parents in retirement
• The parents can easily remove themselves from bank obligations
• The child may have extra motivation as far as the ownership of the business is concerned, giving him or her a bigger stake in succeed.

Do you have questions about succession planning? Reach out to our office today.

While most estates will not owe federal estate or gift tax because of the fact that you can give away or leave much behind without tax consequences, you should still be aware of the estate tax. More people are growing their wealth into a position of needing to plan for estate taxes.

Even if you’re not necessarily concerned about estate taxes, you should be planning ahead to leave the most possible behind for your beneficiaries with one of several planning tools. Read on to learn more about some of the most common deductions and exemptions as they relate to your estate:

• Marital deduction: Property left to a surviving spouse is generally free of estate tax, but you’ll need to speak with your estate planning specialist about how to structure this. Surviving spouses usually get a big tax break if the deceased spouse never used up his or her personal estate tax exemption.
• Personal estate tax exemption: In 2015, the amount allowed to pass without tax consequences is $5.43 million.
• Charitable deduction: If you leave property behind to a tax-exempt charity, this is done so tax-free.

 

As suggested, you need to consult with your estate planning attorney to learn how these might impact your estate.

If you are concerned about being able to manage your finances as a result of incapacitation or another challenge in the future, you might be considering financial power of attorney. This is a simple and cost-effective way for someone else to step in to play this role if you become unable to do so. 

Without a financial power of attorney, your family members might have to request a court proceeding in order to obtain authority for the management of your finances. You can draft this document to go into effect as soon as it’s signed, or you can specify that it becomes active when a doctor determines your incapacity. This is what is known as a springing durable power of attorney. Discuss with your estate planning attorney whether this makes sense for you.

 

The person you give authority to regarding your financial affairs is known as your agent. He or she can manage various parts of your finances like collecting government benefits, investing your money in mutual funds or other vehicles, paying taxes on or buying/selling real estate, or even using your assets to help pay for the everday assets of you and your family. To learn more about a financial power of attorney and what it can do for you, contact our offices today.