Four reasons you should work on your estate planning during the holiday season

It’s likely that you have many plans lined up for the holiday season. Drawing up new estate planning documents or updating existing documents will hopefully be a part of your holiday schedule. If you haven’t yet given serious thought to your estate, or if you’ve been delaying necessary changes to it, please don’t delay.

The following are four reasons the holidays are ideal for estate planning.

1) You’re meeting with loved ones. If you’re meeting up with your loved ones over the holidays, it’s a great opportunity to discuss estate planning issues with them. When possible, you should discuss your estate with people you trust, so that they can give you feedback and also be better prepared to step into any future roles you’re designating for them, such as guardian, trustee, executor or beneficiary of certain assets.

2) It’s a good time of year to take stock of things. During the winter holidays, many people reflect on the past year and how their needs and priorities may have changed (in part because of major life events such as weddings and births). Your estate planning is an expression of what you want your legacy to be and how you hope to care for yourself and your beneficiaries. Think about whether your current estate plans reflect your values and priorities.

3) You’re thinking about your taxes for the coming year. As you consider the amount you need to pay for taxes on various assets (and the amount of taxes on your estate should you pass away) you might want to make revisions to your estate planning – including the formation of certain trusts to better shield your assets.

4) You’ve acquired new significant assets. Perhaps as a holiday season gift, you now have a new car or a new home, or you’ve acquired some other valuable item. How will you include these in your estate plan?

Be sure to contact us to make the most of your holiday season estate planning. We will help make sure that your estate plans are clear and thorough, reflecting your wishes and beneficial to you and your loved ones.

You’re a Trustee….Now What?

We recently posted about an article that ran in the Wall Street Journal entitled, “The Trouble with Trustees,” in which the Journal described the problems that trust beneficiaries can have when clashes arise with their trustees.  While the article did a great job of describing what a trust beneficiary should do to address conflicts, it did not spend much time discussing how the trustee should handle those disputes.

In many cases, being named as someone’s trustee carries a certain level of honor.  Your parents, sibling, close friend, or trusted business associate asks you to serve as the trustee for their child, grandchild, parent, or sibling because they need someone with “good sense” to manage the money for their loved one.  Unfortunately, with the honor of being trusted comes the duty of fulfilling a difficult role.

As the Wall Street Journal pointed out, the trustee and the trust’s beneficiaries can frequently have disputes over issues affecting the trust.  At Ford + Bergner, we have represented countless trustees in these types of disputes, but we also represent trustees before any dispute arises with the hope that we can avoid the chance for a future dispute.  We recommend the following:

1.    The Trustee should regularly contact the Trust beneficiar(ies) to find out if there are issues that he needs to address.

2.    The Trustee should prepare an accounting every year and make copies of the accounting available to the Trust beneficiaries.  The accounting provides good information to the beneficiaries, and it puts them on notice to contact the trustee if they perceive that there are any problems.

3.    The Trustee should regularly meet (quarterly or semi-annually) with the financial advisors managing the trust’s assets to confirm that investment objectives are being achieved.

4.    The Trustee should employ a reputable estate and trust attorney to represent them through the entire length of their service as a trustee.  Although it seems like serving as trustee should just require “good sense,” it is a minefield of potential problems that need the expertise of a competent attorney.

Ford + Bergner represents trustees on a frequent basis.  If you find that you are the trustee of a trust, we would be glad to represent you in any current dispute with a beneficiary or in administering the trust correctly to avoid any future disputes.

The Trouble With Trustees

The November 22-23 weekend investor section of The Wall Street Journal includes  an article entitled “The Trouble with Trustees,” which is a lengthy article discussing how both trustees and beneficiaries of a trust can manage the delicate relationship that can be strained when they clash over how to invest and/or spend the trust’s money.

A Trust is established by one person for the benefit of another person(s), but rather than giving the money outright to the beneficiary, the person creating the trust asks a third party (the trustee) to hold the money or property for the benefit of the beneficiary(ies).  The trust’s creator has considerable flexibility in controlling the terms of the trust and how the trustee should manage, invest, and/or distribute the Trust’s assets and income.

Not surprisingly, the Trust’s beneficiaries can often disagree with the trustee’s decisions.  For instance, when the beneficiary asks the trustee for a new Porsche but the trustee decides that a more economical Honda should suffice, a clash may occur between the beneficiary and the trustee over which car should be purchased.

Ford + Bergner has represented countless clients in disputes over trusts.  Below is a sample of the types of disagreements that arise between trustees and beneficiaries:

1.    Disagreement over the trustee’s accounting for the assets and income.

2.    Disagreement over the way that the trustee has invested the trust’s assets.

3.    Disagreement over how the income is divided between the multiple beneficiaries of the Trust.

4.    Disagreement over how much of the income/assets should be distributed in a particular year.

The Wall Street Journal article encourages trust beneficiaries to regularly review the accounting provided by the trustees.  It also suggests that the beneficiaries should regularly stay in contact with the trustee and keep notes from those conversations.  For trustees, maintaining accurate and complete financial records is important, and the prudent trustee should always treat the trust beneficiaries with respect, regardless of the request.

If you are either the trustee or the beneficiary of a trust and find that you are in a dispute over the Trust, the attorneys at Ford + Bergner will be happy to assist you.

Trust Litigation for Undue Influence: Dealing with Coersion of Kids on a Parent

Trust litigation can be a challenging process when it involves family members attempting to gain a trust without consent of others in the family. This can be a scenario that’s devastating to you if you have a sibling who’s done this without letting you know as means of gaining access to a parent’s assets. It’s a situation we’ve seen many times with our clients at Ford + Bergner LLP, and we can help you through similar situations.

But different scenarios might arise when this happens that could create complex legal territory to tread on. It’s why you should always handle trust litigation through an experienced lawyer who has years of experience dealing with estate issues like guardianship, probate, or trusts.

What Are Typical Scenarios in Undue Influence?

Most typically, it’s a brother, sister, or other relative who happens to be taking care of an aging parent who convinces the parent to execute a trust. They may convince the parent that they deserve complete control of all assets since they’re putting in full-time as a personal caretaker. This may not necessarily be done willfully by the parent if it’s common knowledge that the parent is suffering from senility.

In this scenario, there could be some kind of threat by the sibling against the parent if they don’t start the trust. We’ve seen cases where this is proven, and it’s never pleasant. However, the parent might have done it so they could continue to have the sibling care for them. In those threat instances, the sibling might threaten to walk away as caregiver if the parent doesn’t start a trust in their name.

Proving these cases requires considerable evidence and legal preparation by us. We’ll help determine if that trust in question can be challenged under a specific category. While undue influence is one, we can also challenge a trust based on fraud, ones created while under duress, or based squarely on the parent not being mentally fit.

Contact us at Ford + Bergner LLP so we can help you if you think a trust started by a sibling should be challenged due to undue influence. We’ll help you step by step through the process by acquiring the proper evidence so you have a strong case.

How Should You Prepare For Your Meeting With A Potential Probate Attorney?

The death of someone you love is always a difficult and painful time in your life. Through all of the other processes you have to go through, you also have to deal with the legal processes and procedures. Management of assets, such as properties and estate can always be a difficult task to face, especially under circumstances like this one. Management needs to be handled in a professional and careful manner.

So, it is a wise choice to hire a probate attorney who will be able to complete the dispersal of the estate. From where you stand, the process may seem complicated and difficult, buy an attorney with experience can make sure the process will be smooth and pain f

What To Ask A Probate Attorney

  • Ask about the level of experience and the area of specialty.
  • Ask what papers and documents you will need to bring with you when you have your consultation.
  • Ask if there are any problems that may occur during the process.
  • Ask the attorney about the kind of probate cases he or she has handled.
  • Ask about past clients.
  • Ask about the legal fees.
  • Ask about the choice of communication methods.

Meeting with a probate attorney can be a bit nerve-wrecking and overwhelming. It can be very easy to forget to take your necessary documents with you, and to ask questions you wanted answered. If it is your first meeting or your third meeting with a probate attorney, you can write down a list of questions that you would like to address during your meeting. When you write down your questions and bring them with you, you will have everything in front of you.

A main goal at your consultation meeting is to be able to determine if you are going to hire the probate attorney sitting in front of you. When you take time to be prepared for your meeting, you will assure yourself that you are going into the meeting with the right mind frame and the right paperwork to give the attorney everything he or she needs to start working on your case.

If you are looking for an probate attorney to help ease your family members pain by dealing with the legal complications, contact us.

Wills and Estate Advice: How Can You Coordinate Your Estate Planning with Other People’s Plans?

The Wall Street Journal recently came out with an informative article entitled, “Five Reasons for Parents to Reveal Estate Plans.”

All of the reasons discussed in the article are important to consider as you work on your estate planning. In addition to possibly preparing your children for disappointments, there are also other practical reasons for sharing your estate plan, including receiving invaluable feedback from your children and also coordinating your plan to better accommodate their estate plans, financial situation and personal lifestyle.

Coordinating your estate plan with other people

When it comes to writing up wills and other estate documents, it could be beneficial for you and your loved ones to all be on the same page. This includes not only your children but also other family members and perhaps close friends and other trusted beneficiaries.

One relatively obvious example is if you have young kids and are considering who would be their guardians should you pass away. You need to know if the people you name as potential guardians have the means and ability to raise your kids. There might also be reciprocity, where you’re named as potential guardians for their kids. In this kind of situation, it could be a good idea to sit together and coordinate at least this aspect of your estate plans.

Other elements of coordination could include various trusts. You need to work with your children and other beneficiaries to determine what trust(s) would be most beneficial for all of you when it comes to tax purposes and any financial problems you currently have. This is especially true if you have a rather complex estate in which relatives might be inheriting property jointly.

Don’t hesitate to contact us to discuss these issues. Estate planning should ideally occur with the input of trusted people and in coordination with their own plans. An experienced estate attorney can provide you with invaluable advice and offer you powerful solutions tailored to your personal circumstances.

Under estate law, are you liable for your parents’ debts?

Are your parents in debt?

Statistics reported by show that from the early 1990s onwards, seniors have made up an increasing percentage of people who file for bankruptcy. Medical expenses, job loss and poor investment decisions are among the problems that can leave people in debt; and the recession has cut into many people’s retirement savings.

One of the concerns you may have if you’re inheriting money and various assets from your parents is whether the law also requires you to take on their debt.

Are you on the hook for parental debt?

In general, you can’t personally be held liable for your parents debts. If the debts are enormous, you may get harassed by very aggressive creditors (in which case, you’d need to consult with an attorney on what to do to get them off your back). But in most cases, the only way in which you’ll be affected is that the debts would have to be paid out of your parents’ estate.

Certain assets, such as IRAs, could be exempt from creditors. But if your parents left you their home, for example, creditors might try to seize it. Every asset that creditors successfully claim from the estate means that there’s less for you and any other beneficiaries.

When could you be held responsible?

Sometimes, you may be directly on the hook for parental debt. If you cosigned on any loans with your parents or held any account jointly with them, you’ve likely taken on yourself the obligation to pay off those debts; it’s important to read the fine print of any loan or account you’re a part of.

Another situation to consider is if you’re the executor of your parents’ estate, and you fail to notify creditors and act to pay off the debts using the assets in the estate; in that case, you wouldn’t be living up to your obligations as an executor and might face legal and financial troubles.

Parents and children will hopefully have an honest conversation about any debts that are likely to remain at the time of the parents’ death. Contact us for further advice on how to handle debts as part of your estate planning and discuss possible ways to shield assets from creditors.