Among the notables who died either without a valid will or no will at all are Ross Alexander, Fatty Arbuckle, Anura Bandaranaike, Madhav Prasad Birla, Sonny Bono, George Brent, Lenny Bruce, Jacob A. Cantor, Kurt Cobain, Russ Columbo, Sam Cooke, James Dean, Sandy Dennis, John Denver, Divine, Duke Ellington, Cass Elliot, Chris Farley, Bobby Fischer, Redd Foxx, Mary Frann, James A. Garfield, Marvin Gaye, Ulysses S. Grant, Billie Holiday, Buddy Holly, Shemp Howard, Howard Hughes, Andrew Johnson, Florence Griffith-Joyner, Martin Luther King, Jr., Ernie Kovacs, Harry Langdon, Bruce Lee, Abraham Lincoln, Peter Lorre, Jayne Mansfield, Rocky Marciano, Karl Marx, Steve McNair, Sal Mineo, Carmen Miranda, Keith Moon, Rosa Parks, Pablo Picasso, Mihajlo Idvorski Pupin, Tupac Shakur, Don Simpson, Anna Nicole Smith, William Desmond Taylor, Sharon Tate, Tiny Tim, Ritchie Valens, Hervé Villechaize, Barry White, and Jimmy Witherspoon.

http://www.dailyfinance.com/2011/07/26/amy-winehouses-will-singer-songwriter-played-it-smart/

“San Diego-based estate planning lawyer Daniel Printz tells us the myriad of things to be aware of when drawing up a Will, especially in the areas of child guardianship and business succession. Some of the case studies may highlight unfortunate situations, but fortunately for you listeners this was one of our best, most informative interviews thus far. We highly recommend sharing it with your friends and family!”

For a Rocket Lawyer podcast, this interview was fairly long; 23 of the 32-minute podcast consisted of my interview.  Rocket Lawyer is focusing on April as “Make-a-Will Month,” and I couldn’t be happier to be a part of it. 

HERE IS A LINK TO THE PODCAST: 22 Ep 20_ A Series Of Unfortunate Events – Make A Will Edition

Wills are, after all, probably the best bang for the buck in the estate planning arena.  Because of competition from online services, attorneys have dropped their prices for attorney-drafted wills to the point where it has essentially become a loss-leader.

Even so, it’s a vital piece of estate planning package, especially for parents with minor children who need to designate a guardian of the person and a guardian of the estate. While almost everyone could benefit from more sophisticated estate planning than a will allows, it is certainly true that a will is better than  no planning at all!

Wills with guardianship provisions for minor children can usually be drafted and executed in a single day. If you’re interested in finding out about our low prices for simple wills, give us a call right now at (858) 720-8250 – just ask for Daniel.

It’s surprisingly hard to buy a house. In today’s depressed housing market, home prices and interest rates are low. Normally that would mean that homes would be rapidly purchased, thus driving up home prices. But here in the “Great Recession,” buyers are finding it hard to qualify and often need to provide significant down payments.

More and more often, young people and couples are turning to parents for help in making that house purchase. From an estate planning perspective, the devil is in the details; the success of the transaction will lie in making the proper choices given the facts.

First, you need to decide whether the help is a gift or a loan. Second, you need to decide if there will be any type of security if it is a loan.  Third, you need to decide how to treat the assistance in the parents’ estate plan (will or living trust).

If the assistance is a gift, then the advantage to the parent is that they move some money out of their estate, thus reducing potential estate taxes on estates over five million ($5,000,000).  The disadvantage to the parent is that they might have to pay gift taxes on the transfer.

If the assistance is a loan, then there are two advantages that leap out. First, the parent can can secure the loan with a lien against the home. This would be a second, since the mortgage company is going to take the first position as the primary lender. Second, as a lender, the parent is creating a stream of income, essentially creating an annuity earning some interest.

The disadvantage of a loan is that if the parent suddenly needs money, the parent can’t pull the money out of the house, the way they could if they had put the money into a different investment vehicle like a mutual fund.  Also, if the child doesn’t pay back or misses payments, they are unlikely to enforce the lien, thus making the lien a hollow threat.  Finally, if the assistance the parent provides is to actually co-sign the loan, then they could be on the hook for the entire loan amount if child defaults, goes bankrupt, passes away, and can suffer credit blows from late payments.

Parents who want to help out should always remember that their investment could be lost due to child’s creditors foreclosing on the home with no other security.  Therefore, it’s the assistance, rather than the investment, that should be the driving motivation.

Whatever choices the family makes, the parent’s act should be memorialized in a writing so it can be understood in the context of their estate planning.  If this was a gift, was it an advance on their inheritance that should be taken into account when diving property among children?  If it was a loan, will it be forgiven on parent’s passing or should it count against the inheritance?  The idea here is to minimize the possibility of litigation between children on the parent’s passing by making the parent’s wishes about the assistance to that one child very clear.

If you’d like to help out your child with buying a house, or if you need assistance from your parent with a purchase, sit down with a certified financial planner and with an estate planning attorney to make sure it’s done right.  You can call my office at any time for a free consultation at (858) 720-8250.

A great additional resource can be found here – a comprehensive review of parent/child mortgage help advice!

As so often happens, the most important story is the one not told.  Yesterday, Inside Edition broke the news that the late Tony Curtis, who passed away in September of 2010, had specifically disinherited his children in his will. To the tabloids, what is important here is that, five months before his death, Tony Curtis re-wrote his will.  (Amusingly, some have referred to five months before his death as his “last days.”)

I haven’t personally seen the will, so I’m don’t know whether Inside Edition is correct in it’s implied allegation that Mr. Curtis apparently didn’t leave anything to his children. After all, he could have easily provided for them in other ways (life insurance, direct beneficiary investment accounts, etc.).

Assuming that they are correct,  what is astonishing is not that he disinherited his children, which frankly happens often enough not to produce comment by estate planning attorneys like myself, but that he chose to do so publicly when it would be so easy to privately leave his estate to his widow, Jill Vandenberg Curtis.  Let me quote InsideEdition.com:

“INSIDE EDITION has obtained the will, written five months before his death from cardiac arrest last year at age 85. His children are listed by name, including Jamie Lee. Then there’s this statement: “I acknowledge the existence of my children…and have intentionally and with full knowledge chosen not to provide for them.”  Instead, Curtis leaves his estate to his widow, Jill.”

Ignore for a moment that Tony Curtis has joined a long line of celebrities who fail to consider the ramifications of the Probate process.

Instead, consider this: Tony Curtis could have accompished the exact same thing, disinheriting his children and leaving his entire estate to his wife, and done it privately, without his widow and children being exposed to our prying eyes.

If Tony Curtis had made a trust, then his will would simply direct that his entire estate be distributed to the trust. Then, in the trust document, which would remain private, he could direct that everything be distributed to his wife.  Voila!  The exact same result, but without dragging the family through the tabloid mud. After all, it’s really none of our business.

Furthermore, by using a trust, he could have easily left something to his favorite charities, to particular friends, or to his grandchildren or great-grandchildren, who one assumes are too young to have voiced disapproval over Mr. Curtis’ life choices. It begs the question: was the omission intentional? Did he actually desire this result, or did he just not ask anyone’s advice? I think it was the latter – most people simply don’t know the right questions to ask.

Ironically, Jill Curtis’ response to the tabloid reports was: “Tony’s last will and testament and his passing wishes . . . are private family matters.” Sadly, they’re not private at all. But they could have been. 

I was recently asked the following question on the legal answer website AVVO.COM.  My answer was chosen as “best answer” by the questioner.

Question: My father wants a copy of my parent’s trust. He wants to request this in writing as it is difficult for him to get around. My mother claims she has misplaced the trust. My father would like to get a copy of the trust for me, but he is partially paralyzed and we had to hire full time help to assist him with his daily activities.

The trust attorney told me I would have to write a letter requesting it with the signatures of both of my parents. My father would do this, but my mother refuses. Is there any other way to get a copy of this trust? My mother constantly threatens me, telling me she is going to change the trust.  If my dad is a Trustee, can the Trust attorney legally refuse to do so? Would my dad’s request have to be notarized?

Answer (after another attorney had stated that the questioner’s mother would have to approve): I disagree. Your father, as a settlor and trustee, has a right to a copy of the trust that he and your mother hired the attorney to draft, assuming the attorney still retains a copy in the file. The request does not have to be notarized; in fact, he should simply be able to pick up the phone and call. If the attorney is skeptical about your father’s identity, then he should go to the office himself to pick it up, even if it is difficult to get around.

However, if I were you I’d talk to an estate planning attorney about this, and the underlying family issues that seem to be present. Where is the original? Was it destroyed? Lost? Is there in fact any property still in the trust? Is there a pending divorce?

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If you want to pose legal questions anonymously and have them answered by a handful of attorneys practicing in the field, consider coming to AVVO.com.  Or, just call me directly at (858) 740-4370, and I’ll answer your question myself or find someone who can.

“What would happen to my children if something happened to me and my spouse? How do I protect my children as a new parent?” With simple estate planning, you can easily ensure that your children would be raised by the person you choose and that your children would not inherit everything at age 18, but at the ages and stages you want them to inherit. 

San Diego’s “The Parent Connection,” a non-profit sponsored by Scripps Hospitals, is hosting a seminar with guidance for new parents.

Estate planning and early financial decisions are  important for every new parent.  Making plans for your possible death or incapacity is an important part of your new responsibilities.  It may not be an pleasant task, but that doesn’t mean that you can just cross your fingers and hope that the worst won’t happen to you.  A well-versed estate planning lawyer can walk you through the maze of choices you need to make as a responsible parent.

Daniel K. Printz, Esq., an estate planning attorney and adjunct faculty member at the University of San Diego, and Kristin Barron, a financial planner,  will discuss how to avoid probate, how to be prepared to cover the issues of incapacity, how to secure your financial future as well as your child’s college education. You’ll have the opportunity to learn about 529 plans, education and Roth IRAs, UTMA accounts and alternative investments.

Date: Saturday, January 22, 2011          **** Activities will be available for children ****

Time: 9:30 am to 11:30 am

Location: Scripps Coastal Medical Center, Eastlake — 971 Lane Avenue, Chula Vista, 91914 

This event is free for Parent Connection members, $10 for nonmembers. Registration for nonmembers will be reimbursed; provide receipt at the event.  Register by calling the Law Office of Daniel K. Printz at (858) 720-8250 OR online at http://www.sandiegoparent.com/TPC/event/signup.html.

Here are the factors that should be weighed by the trustee in establishing his or her compensation:

-  Amount of time spent 
-  Gross income of the trust 
-  Appreciation in value of trust property 
-  Unusual or special skills – attorney, accountant 
-  Degree of fidelity or disloyalty to trust 
-  Amount of risk/responsibility 
-  Fees charged by other trustees in the local community for similar services 
-  Character of trustee’s work: did it involve skill/judgment, or was it mostly ministerial
-  His own estimate of the value of his services 

A good place to start in establishing how much you will claim as trustee is to poll local professional fiduciaries to establish the ‘local community’ factor. 

But bear in mind, the Court can review the compensation, on request of a beneficiary.  The last thing you want to do is provoke a dispute with the beneficiaries.

PURPOSES OF AN INTERNATIONAL TRUST

There are two main purposes of an international trust for U.S. citizens.  The first is to combine domestic and offshore assets into a unified estate plan with a common trustee and set of instructions.  The second use of interantional trusts is for asset protection.

ASPECTS OF AN INTERNATIONAL TRUST

International trusts for asset protection are refered to as “Asset Protection Trusts.”  The countries which provide for Asset Protection Trusts are: The Cook Islands; Nevis; Belize; Bahamas; the Channel Islands; Switzerland; and, Liechtenstein.

According to Jacob Stein’s treatise on asset protection, common provisions enacted among some, but not all, of these countries are:

1. there is no recognition of foreign judgments with respect to trusts
2. there is a very short statute of limitations on fraudulent transfers
3. to establish a fraudulent transfer the creditor must show that the debtor was insolvent, and must establish the debtor’s intent to “hinder, delay or defraud” beyond a reasonable doubt;
4. the anti-duress provisions are incorporated into the statutes; and
5. spendthrift protection is extended to self-settled trusts.

CAUTIONS REGARDING INTERNATIONAL TRUSTS

Two things should be noted.  First, transferring your assets offshore does nothing to relieve a U.S. citizen from declaring income for tax purposes; we must declare non-domestic income and capital gains.  Also, there has been an increase in regulation regarding reporting requirements – as a result, some resident trustees in the foreign jurisdictions have either retired or greatly reduced the number of separate trusts they are willing to handle at a time.

Before implementing any estate planning, financial planning, or tax planning strategy, be sure to consult with and heed the advice of a professional certified to assist you with these matters!

Question:  How can my parents change their revocable trust without an attorney?  My parents reside in Wisconsin and have a revocable trust with 3 of 8 children designated to administer the trust.  If they wish to delete 1 of the 3 or replace 1 of them, would they need to go through an attorney?

Answer: It’s probably best to use an attorney to create an amendment to the trust – it shouldn’t be expensive at all if they are making simple changes like altering the named successor trustees.

To do it themselves, they would make a new document, entitled “First [or second, or third] Amendment to the John and Jane Doe Trust”, identify themselves, identify the trust, cite and quote the language in the trust granting them the right to modify, cite the section being modified, include the newly re-written section, and sign and notarize the document with all the formalities necessary for a trust in their state. Then they should create a Certificate of Trust as appropriate in their state.

As you can see, it requires a certain familiarity with trust drafting. Considering the amount of money at issue in a trust, it’s well worth your parent’s money to spend $100 to $300 to have a professional do the work for them.

- Daniel K. Printz, Esq.

Steve Fromm, Esq., then noted: The prior attorney is right on point here. You do not want to jeopardize the validity of a trust by trying to undertake this task without a lawyer. The costs here are minimal versus the things that could go wrong.  (Thanks, Steve!)