A 33-hour course, Estates, Wills & Trusts covers such topics as the use of various estate planning methods and devices, including wills, trusts, durable powers of attorney, health care directives and beneficiary designations. The rules of intestate succession will be covered. Emphasis will be placed on planning tools and administration of estates.

The course is also designed to introduce the procedures and court proceedings required to manage probate and non-probate transfers in California. Students are required asked to prepare forms that are ordinarily required in formal California probate proceedings.

The course is taught Tuesday and Thursday evenings from October 6 through September 10th.

For more information, contact Mr. Printz at (858) 720-8250 or the University of San Diego Paralegal Program at (619) 260-4579.

The title of the seminar is Estate Administration Procedures: Why Each Step is Important. Along with Mr. Printz, faculty will include Janathan Allen of Allen Barron, sole practitioner Stuart Schechter, and Charles T. Scott of Kimball, Tirey & St. John.

The seminar will provide the following credits: California MCLE Paralegal; CFP for Financial Planners - 8.0; CLE for Attorneys- 6.75; CTEC for tax preparers- 8.0; IACET – 0.7; CPE for accountants/NASBA – 8.0; and PACE (CLU, CASL, ChFC) – 8.0

To register, call (800) 930-6182 or go to www.nbi-sems.com.

This is a basic level seminar, and provides fundamental estate administration topics for: attorneys; accountants; paralegals; trust officers; estate planners; and financial planners.

Speaker Daniel K. Printz, Esq., teaches “Estates, Wills and Trusts’ in the University of San Diego’s intensive paralegal program. He will speak on the essentials of estate planning for young families at this seminar – free for Parent Connection members and $10 for non-members.

Wednesday, January 27, 2010. 6:30 p.m. to 8:00 p.m.  Scripps Coastal Medical Center. 2176 Salk Avenue, Carlsbad, CA 92008.  South Entrance.

To register, use this link and find our seminar “Wills and Trusts” through the pull-down menu: http://www.sandiegoparent.com/TPC/event/signup.html

Among the topics covered in this year’s guide:

• Social Security Benefits
• Age Discrimination
• Senior Housing restrictions
• Medi-Cal v. Medicare
• Planning for Incapacity
• Drivers Licenses
• Elder Abuse
• Divorce and Remarriage
• Grand-parental Rights
• Finding a Caregiver or Nursing Home

For concerns about any of these issues, contact a qualified attorney.

Under IRC Section 2503(b), the first $13,000 (plus cost of living adjustments) of gifts to any person, other than gifts of future interests in property, made during a calendar year are not included in the total amount of gifts made during the year. There is no limit to the number of recipients to whom a donor may make an annual exclusion gift each year.

Therefore, a client with numerous objects of his or her affection can significantly reduce their estate with tax-free transfers.

Let’s say John Doe has eight nephews and nieces. Each year he can make $124,000 (8 x $13,000) in gifts free of gift taxation.

Moreover, spouses can elect to great a gift of separate party made by the owner spouse to a third party as being made one half by each spouse. Thus, John and his wife Jane can make a $26,000 gift to each donee.  (Note – this tool is not available to California same-sex domestic partners or California same-sex married couples, as these are federal rules.)

Now that there is clarity in the Estate Tax exemption for the foreseeable future, gifting is one of those tools we can offer our clients to abate potential estate tax issues.

Want more information? Contact an experienced attorney or CPA.

The administration’s proposal also means that the temporary total repeal of the estate tax, which would have meant that even the very rich could have passed their entire estates free of estate tax at death, will not occur in 2010 as planned. It also means the estate tax credit won’t reset to Clinton-era levels of $1 million dollars and a 55% tax rate in 2011, which is when the current legislation, passed as part of the 2001 Bush tax cuts, was scheduled to expire.

The Senate’s recent legislation included an amendment that would increase the Estate Tax Exemption to $5M per individual, but that has to be hammered out with the House of Representatives, who if left to their own devices might argue for lowering it (don’t fret – they’re not left to their own devices!).

What this means for you and your estate planning attorney is that now is the time to do some serious planning – let’s pull out those dusty trusts, kick the tires, and do some serious wealth management. If you’ve been putting it off because of uncertainty about the estate tax, now is the time to act!

What should you put into your Letter? Here are some suggestions:

Tell where copies of your will and/or revocable living trust can be found and where the originals are kept. Also give the names, addresses and telephone numbers of all personal representatives, executors, trustees, lawyers, conservators or guardians involved, and explain any potentially puzzling provisions that the documents may contain.

List essential papers and records and tell where they can be found. What’s important?  Birth Certificate, Marriage Certificate, Citizenship Papers (if any), Judgment of Divorce, Living Trust/Wills, etc. 

You also might want to give funeral instructions (those should also be in your Advance Health Care Directive / Living Will).

List your life insurance agent.  You should also mention any medical or disability insurance that might cover medical bills charged to the estate.

I do *not* recommend you list bank accounts, but it would be useful to tell your executor where they can get quick cash — there will be some immediate expenses after death.

Give the names and addresses of your employer, and well as any fraternal organizations or unions you belong to. They may provide death benefits or burial expenses. In addition, give your Social Security Number.

If you own real estate in addition to your house, give the same information about it, along with the names of your real estate and insurance brokers.

List all your personal property and how you would like it distributed if you have not done so in your will or a Separate Written Statement authorized in your will or trust—but keep in mind that your instructions will not be binding unless specifically mentioned in the will, trust, or Separate Written Statement. 

Make a list of major debts you owe and major debts that other persons owe to you. Tell precisely how you want these matters settled, including whether you want to forgive any debts owed to you.

Tell where to locate copies of your past tax returns, where current tax information can be found, and name your CPA or tax preparer.

List any trusts under which you are named as a beneficiary, or any trusts set up by others under which your heirs are beneficiaries. Give the names and addresses of all persons involved, including attorneys.

List the names, addresses and telephone numbers of your parents, if living, and of any other relatives or close friends who should be notified of your death. Also give the names and addresses of your employer and any close associates at work.

Give the names and addresses of any lawyers, accountants, brokers and the like not already mentioned who might be helpful to your survivors.

Does this sound like a good idea?  Try drafting one for yourself!  If nothing else the exercise is bound to remind you of things you need to prepare for yourself.

Special Needs Trusts are often prepared for disabled adults with disabling conditions, such as: autism; paraplegia or quadriplegia; Alzheimer’s disease; mental illness; even chronic chemical dependency. The function of the SNT is to provide a pool of funds from which a trustee can distribute to the disabled person only so much money that they don’t imperil their ability to obtain government benefits such as SSDI (Social Security) or Medicare (Medical, here in California).

A few notes for practitioners:

(1) Many template-drafted SNTs restrict the ability to revoke, amend, or terminate. Revocation is one thing – by all means make the trust irrevocable. But the ability to amend or terminate are important tools for the trustee, and necessary flexibility every attorney should provide in the SNT.

What if the beneficiary comes into a flood of income? They may no longer want some funds tied up by the SNT.

What if the law changes, as it recently did to enable trustees to pay for clothing? If the SNT restricts the ability to pay for clothing, then the trustee can amend the trust to deal with the change in the law.

(2) It’s important to distinguish between third-party trusts and first-party trusts. A first-party trust is funded by the disabled person themselves, and should be a grantor trust. A third-party trust is funded by someone else, usually a parent or child, and remains revocable throughout the grantor’s lifetime. The rules are different regarding each, and so some investigation must take place to ensure that the source of funds really is that third party and not the beneficiary themselves. What if the client says: “My mother gave me this money, and it’s mine to do with as I please. But I feel obligated to put some of it into this trust – she wanted me to be able to care for her.” Arguably, the mother in this example transferred the money to her daughter in order to fund the trust!

(3) It’s usually a good idea to draft the Special Needs Trust as a stand-alone trust, rather than as as part of a larger AB or other living revocable trust.

It’s a common mistake by estate planning attorneys who don’t deal often with special needs situations, and it may seem more efficient to have the SNT kick in only on the death of the surviving settlor. But there’s good reason to consider drafting it as a separate trust. You can designate different trustees and successor trustees. You can give the grantors important insight as to how the trust will/must be managed by having them manage it during their lifetimes, while they can still modify or revoke it. Also, it’s likely you’ll be designating different residuary beneficiaries in the SNT than in the AB-Trust.

Just some things to think about. The most important advice, as always: consult an attorney with experience not just in drafting trusts but in advising successor trustees!

Good luck, and good planning!

You should strongly consider a revocable living trust if any of the following are true:

1.    You own real property

2.    You have over $100,000 in gross assets

3.    You want to maintain your privacy

4.    You want to protect your children from squandering their inheritance

How does a revocable living trust accomplish these goals?  It avoid probate by keeping all of your trust assets outside the reach of the probate court. It protects your children against squandering their assets by permitting distribution over time. For example, you can instruct that your children will receive their inheritance 1/3 at age 21, 1/3 at age 25 and 1/3 at age 30.  Finally, the revocable living trust protects against incapacity by providing a technique for a successor trustee to immediately take management control of your property if you are ever unable to manage your financial affairs.

Call us today for a no-cost conversation about revocable living trusts.