Calabasas Estate Planning Lawyer

How to Convince Your Spouse to Meet with a Calabasas Estate Planning Lawyer

by Estate Planning

The estate planning process is sometimes initiated by one spouse, while often being met with hesitation by the other. The reasons are totally understandable, since thinking about death or incapacity can bring many uncomfortable feelings. There is also a sense of comfort in the fact that “ignorance is bliss,” as many people don’t want to confront their current life situation.  

Keep this in mind, though: while it’s never too early to plan, it can oftentimes be too late. Sticking our heads in the sand won’t lessen the need to create an estate plan. That’s why we’re giving you answers to the three most common excuses for avoiding estate planning, which will help you convince your spouse that it might be time to speak with a Calabasas estate planning lawyer:

“Why do I need an estate plan, especially now?”

Most people think that they don’t have to create an estate plan until they reach retirement age. This, of course, is a huge mistake since tragedy can strike at any time. Some people also mistakenly believe that an estate plan is only needed if they have a great deal of money. They should know that estate planning is much more than dividing your assets, as it includes the ability for others to make important medical or financial decisions for you or your spouse in the event of disability or incapacity.

“You’ll inherit everything anyway.”

It’s true, a spouse will most likely inherit the majority of the estate. But what if something happens to both spouses? And what about your children? If you don’t have an estate plan, you won’t have a legal say in who raises your kids if both spouses pass away. Children from a previous marriage may also end up disinherited when the new spouse inherits the majority of the estate. Your spouse could also end up with estate taxes, court fees, and legal burdens after you pass.

“We already have an estate plan.”

This excuse could definitely throw you a curveball since it’s technically true. If you die without an estate plan, your estate goes through the legal process that is set forth in your state’s laws. So why would you spend the money to create an estate plan if the state already gives you one? It’s simple: the State does not take any of your wishes into consideration. Not only that, but the process of settling one’s estate through the probate courts is long, expensive, and extremely stressful for your loved ones.

If you want to get started on your estate plan, or if you want to have your existing estate plan reviewed to ensure it still fits your current situation, please contact our law firm at 818-334-2805 to set up a consultation with one of our Calabasas estate planning lawyers.

Calabasas Will Lawyers

Calabasas Will Lawyers Answer, “What is a Roth IRA and Why is It Good for Estate Planning?”

by Estate Planning

Individual Retirement Accounts (IRAs) are savings vehicles that allow a tax deduction to be taken when you contribute to the account. The maximum contribution in 2021 is $6,000, and those age 50 and over may contribute an additional $1,000. The income is not taxable while the assets are held in the IRA, however, the distributions are included in taxable income when taken in retirement.

This is where the difference between a Roth IRA and a traditional IRA comes in. A taxpayer who contributes to a Roth IRA does not get a deduction for the contribution, meaning they have to pay full taxes on any amount that goes into the account. From there, however, the earnings grow tax-free and they are generally not taxable when the distributions are made during retirement.

How to Qualify for a Roth IRA
A taxpayer may only qualify to make Roth IRA contributions if their taxable income is within certain limits. Married taxpayers who file joint returns may contribute the full amount if their income is below $198,000 in 2021. A phase-out occurs after $198,000, eventually ending at $208,000, at which point the taxpayer cannot contribute anything if their income is $208,000 or higher. An unmarried taxpayer may make a full Roth IRA contribution if their income is below $125,000 in 2021, with a phaseout up to $140,000, after which point no contribution is allowed.

While the eligibility to contribute to a Roth IRA depends upon the taxpayer’s taxable income, anyone may convert their traditional IRA to a Roth IRA. The amount of the traditional IRA is taxable when the conversion is made, meaning they will have to pay taxes based on his income tax rate on the full amount held in the traditional IRA.

Why a Roth IRA is Good for Estate Planning
Roth IRAs also differ from traditional IRAs in the fact that you can let your savings accumulate tax-free in the account over a long period of time without taking the minimum withdrawals. This will most likely lead to you having a significant amount of money in your Roth IRA when you pass away. Once you pass away, the Roth IRA will pass to the beneficiary you named on the account. This means that the assets in the Roth IRA will not have to go through the probate process, unlike your other solely-owned assets. Be sure that your beneficiary designations are up to date, however, as they could end up going through a long and costly probate process if your beneficiary predeceases you and you do not name a replacement.

If you have any questions about the difference between Roth IRAs and traditional IRAs, or if you’d like to have your current estate plan reviewed to see how a Roth IRA could help, please contact our Calabasas will lawyers at 818-334-2805 to set up a consultation.

San Fernando Valley estate planning attorneys

What is a Life Insurance Trust? | San Fernando Valley Estate Planning Attorneys

by Estate Planning

There are several different trusts available to achieve asset protection planning goals and to ensure you leave a legacy behind for your loved ones. One of the most common trusts to help achieve these goals is an irrevocable life insurance trust, also called ILIT. These trusts protect the benefits of your life insurance policies by keeping them separate from your taxable estate. Experienced San Fernando Valley estate planning attorneys recommend ILITs to their clients who own large life insurance policies that, in addition to other assets, may put those clients over the state or federal estate tax thresholds. ILITs also allow policy owners to choose who benefits from the life insurance proceeds and how those benefit payments are distributed.

But how do you know if an irrevocable life insurance trust is the right tool for you to protect your assets? The first step you should take is to speak with a San Fernando Valley estate planning attorney who can determine if this trust fits in with your goals. Here is some additional information that can help you get ready for that discussion:

An ILIT is an irrevocable trust, which means it cannot be changed or revoked by the Grantor (the person who makes the trust), and the Grantor must give up all ownership of the Trust assets. Once a life insurance policy is transferred to the ILIT, the Grantor no longer owns the policy and technically has no control over the policy or any beneficiary designations. However, the Grantor sets the terms of the trust, so they control how the life insurance distributions are made and to whom, as well as when those distributions are made to the beneficiaries.

The Grantor names a Trustee, usually a spouse or adult child, to oversee the trust and the life insurance policy. Keep in mind that the life insurance policy must be transferred to the ILIT at least three years before the death of the Grantor, otherwise the trust will not be valid.

An irrevocable life insurance trust is difficult to craft correctly and requires the knowledge of an experienced estate planning attorney to create. If the trust is created incorrectly, your estate may be responsible for paying estate taxes on your life insurance policies while your wishes for your beneficiaries may not be fulfilled.

If you are interested in learning more about irrevocable life insurance trusts, or if you’d like one of our experienced San Fernando Valley estate planning attorneys to review your existing irrevocable life insurance trust, please contact us at 818-334-2805 to set up a consultation.

Calabasas trust attorney

Calabasas Trust Attorney: 3 Questions to Ask Yourself When Choosing a Successor Trustee

by Estate Planning

As a Calabasas trust attorney, I help many seniors set up Revocable Living Trusts to avoid probate proceedings and to give clear instructions on how they want their assets and property handled after death. The Grantor creates a trust once it is signed and funded with assets or property; that means anything used to fund the trust is technically property of the Revocable Living Trust. The Grantor no longer owns the trust assets and property, though they do retain control over it if they are the Trustee of the trust.

This is the beauty of a Revocable Living Trust: it can survive the incapacitation and even death of the Grantor and Trustee because the trust owns the property and allows for various people to control it as Trustees. When the Grantor/Trustee passes away or becomes incapacitated, a Successor Trustee (who is already named in the trust to serve in that capacity) gains control over the Trust assets, though must still abide by the terms and conditions of the trust. But before you choose a Successor Trustee for your trust, you should ask yourself the following questions:

Who will want to handle my trust?

Typically, Successor Trustees are either the spouse or adult child of the Grantor/Trustee, but just because they’re family doesn’t mean that they want to handle the trust. A spouse may not be able to handle the work needed to be a Successor Trustee, and adult children may want to avoid conflicts with siblings or other family members or may even have a complicated personal situation and simply cannot take over the extra responsibility. Speak with your potential Successor Trustees to find out if they think they’ll be able to handle the job, and make sure to provide additional instructions in your trust on who should become Successor Trustee if the person named cannot or will not accept the position.

Should I name co-Trustees?

There are pros and cons to having co-Trustees. On one hand, it may be a good solution to ensure everyone feels they are being treated equally. On the other hand, it can lead to family conflicts and difficulties in administering the trust. In many cases, co-Trustees are named to serve as Successor Trustees, but one will usually relinquish power to the other in order to make things go smoothly. If you are considering naming co-Trustees, you should speak with an experienced Calabasas trust attorney to find out all of the potential pitfalls.

Will the Successor Trustee be strong enough to serve?

One thing that is often overlooked is the fact that a Successor Trustee will have to operate during difficult moments, such as when the Grantor becomes medically incapacitated or after the Grantor passes away. This is why many people ultimately settle on a professional trustee or Calabasas trust attorney to serve as Successor Trustee. This avoids any emotional issues and family conflicts, while allowing decisions to be made objectively. One potential drawback to having a professional Trustee or attorney serve as Successor Trustee is that they charge a fee for their services, which is usually a percentage of the total trust assets.

If you’d like more information about Revocable Living Trusts and Successor Trustees, or if you’d like to review your existing Revocable Living Trust with an experienced Calabasas trust attorney, please contact us at 818-334-2805 to set up a consultation.

LA County special needs lawyers

North LA County Special Needs Lawyers: 3 Important Steps for Special Needs Trusts

by Special Needs Planning

All parents who have a child with special needs want to make sure that those children are taken care of in every instance – most importantly, after the parents have passed away or can no longer provide personal care for the child. Creating a special needs trust is extremely crucial in keeping that continuity of care and making sure your loved one can receive all the benefits available to them from state and local agencies. Here are three important steps that North LA County special needs lawyers recommend for special needs trusts to ensure it will provide for your loved one with disabilities:

Step 1: Create the Trust

The most important goal of a special needs trust is to make assets and property available for the benefit of your special needs loved one without transferring ownership to them. Ownership of those assets will disqualify them from needs-based benefits and make it much harder to receive necessary care and enjoy a nice quality of life. The first step in making this happen is to contact a lawyer who has experience creating special needs trusts to make sure the trust is valid and covers all your loved one’s needs. The last thing you want to do is create a trust that you believe provides protection for your loved one only to have it invalidated after you pass away due to mistakes made during its creation. This may leave your loved one in a bad situation without any way to receive funds or necessary care.

Step 2: Fund the Trust

A special needs trust must be funded with assets or property once it is signed for it to come into effect. This can happen immediately, or the trust can be funded by a Last Will and Testament at the time of your death. North LA County special needs lawyers will review both options with you and help you choose which one works best for your situation. The assets and property held within the special needs trust are used to pay for items that are not typically covered by government benefits, which means that your loved one can enjoy a better quality of life through housing, education, and entertainment.

Step 3: Administer the Trust

The Trustee is the person who administers the special needs trust. The Trustee is tasked with making sure the terms of the trust are followed and your loved one receives everything they need from the trust. The Trustee typically will be a parent or whoever initially created the trust, however a Successor Trustee should be named to take over in case the original Trustee is incapacitated or passes away. Administering a special needs trust can be difficult since there are so many rules that need to be followed, so it’s advised to consult with an experienced special needs attorney in North LA County to determine how best to choose a Successor Trustee.

If you would like to get more information about setting up a special needs trust for your loved one, or if you’d like to have your current special needs trust reviewed to make sure it provides the right amount of protection for your loved one, please contact us at 818-334-2805 to set up a consultation.

North LA County guardianship lawyers

North LA County Guardianship Lawyers Answer: Will My Ex Get My Children if I Pass Away?

by Estate Planning

North LA County guardianship lawyers are asked this question nearly every day! The answer is…maybe. Before you begin to worry, let us explain.

When nonmarried parents have a formal custody agreement and one party passes away, that custody agreement is no longer valid. In most cases, the child’s permanent custody would revert to the surviving parent.

What If the Surviving Parent is “Unfit?”

If there are concerns about the fitness of a surviving parent, the State of California has a provision where a third party can step in and apply for guardianship of a minor child. For example, a grandparent may be compelled to apply for guardianship if they feel the surviving parent is not capable of raising the child(ren). Unfortunately, in these circumstances, the burden of proof is on the grandparent (or other petitioner). The third-party would have to prove in court that the surviving parent is unfit, which could result in an expensive and lengthy custody battle.

You Can Still Have a Say

As a parent, you can also take steps to make your wishes for your children known in your will.  If you believe that your ex is unfit or unable to care for your children in your absence, you can use your estate plan to spell out your concerns and offer up alternative choices for guardians.  After your passing, a judge will be given the opportunity to review your wishes and ultimately decide if choosing a guardian other than the biological parent would be in the child’s best interest.

What if parental rights were terminated?

If the surviving parent has previously had their parental rights terminated, they will not be considered for guardianship of the child(ren) after the death of the other parent. In these cases, it is extremely important for the parent who retains rights to have an estate plan that spells out exactly who should raise the child and what resources are to be used to do so if something happens to mom or dad.

Get Informed to Be Empowered

While guardianship questions are rarely black and white, the solution in almost all instances is to create an estate plan. There is nothing more important in life than protecting our children’s future, and a straightforward estate plan can give you the peace of mind that your child will be protected no matter what!

If you have questions or you are ready to get started with creating legal documents to protect your family, please contact our North LA County guardianship lawyers at 818-334-2805 to schedule an appointment.  

West San Fernando Valley will lawyer

Tackling Your Responsibilities as An Estate Executor | West San Fernando Valley Will Lawyer

by Estate Planning

In life, there are jobs we seek out and others that are given to us. Being named an Executor on an estate is one of the most important jobs one can be asked to hold by another person. It means there is someone who trusts you fully and believes that you will manage their final wishes properly and without conflict.

That’s not to say the job is easy. Again, you were likely appointed to the role of Executor because your loved one felt you could handle any stress or difficult responsibilities that come with the job. 

The good news, however, is that there are ways to prepare in advance so that your life as an Executor is easier when the time comes. Here are some suggestions a West San Fernando Valley will lawyer would have you consider:

  • Have the hard conversations now. Meet with the person who is naming you as an executor of their estate and ask them to describe exactly how they wish their estate to be administered. Take notes and make sure you get all the details. Knowing the “why” behind the decisions in the will can help you navigate “gray area” choices if they arise.
     
  • Be organized. The job of Executor consists of lots of paperwork, bureaucracy, and time maintaining the estate as it goes through the probate process. Set up a filing system, spreadsheets, and bins, so the Executor job does not infringe on your everyday life.

  • Get a lawyer. No matter the size of the estate, it is prudent for all involved parties to have a lawyer. At the minimum, have a consultation with an attorney to make sure there is not something you have overlooked. People often think they can do everything themselves only to be caught at the end by taxes or administrative issues.

  • Move quickly once the person passes away. Grief makes people act in unexpected ways, so it is imperative that after the person dies, you move quickly to locate the original final will and file the necessary paperwork with the courts to be recognized as the Executor. At this time, order up to 8-10 copies of the death certificate to save yourself time later. Another uncomfortable thing you will need to do is to secure the assets. All too often, grieving loved ones will go to the home and begin to take items they believe they should have. You will have to be the one who stops this.

  • Be upfront with the heirs of the estate. Make sure they all get a clear understanding of how estate administration works. The process is a slow one, which frequently frustrates family members who are grieving. By giving them an explanation or better yet, having a lawyer do it, they will hopefully have patience with you and avoid conflicts.

  • Know there will be conflicts. Grieving is an individual process, and you will take the brunt of most of that emotion. If money is involved in the administration, the speed at which money is inherited can be infuriating. Heirs becoming angry with you is even more of a probability if any perceived omissions or secret bombshells are in the will. Hopefully, if that is the case, you knew ahead of time and were prepared.

  • Heirloom distribution needs to be deliberate. Once the significant assets and personal items are named in the will, the hard part starts. Deciding who receives the personal items in the home can cause the most conflicts. There is no explanation for the small household items that might have importance to many family members. A sweatshirt, a picture frame, or a dish can hold deep memories that you might be unaware of. Creating an equitable system for if multiple people want an item will ensure this process is done deliberately.

These are only a few ways you can help yourself if you have been named an Executor. If you find yourself struggling with your duties and or you have questions and need some advice, we are here to help. Contact us at 818-334-2805 to schedule an appointment with a West San Fernando Valley will lawyer.

Calabasas will and trust lawyers

How to Add, Change, or Remove Your “Legacy Contact” On Facebook

by Estate Planning

Have you ever thought about what you want to happen to your “digital assets,” including your Facebook page, after you pass away?

This is a question that Big Tech giants have spent the past few years grappling with as more and more of our lives are lived online. As such, companies like Facebook have started developing solutions to help account holders more easily “pass on” their digital real estate to loved ones and friends following their death. “Legacy Contacts” is one such feature that permits this to happen on the platform.

Until the creation of the Legacy Contacts, loved ones of the deceased only had two choices to manage an existing Facebook Account:

  1. Leave it a public wall (that no one had “behind the scenes” access to) where people could continue to post messages; or,
  2. Request that the page be “memorialized,” which rendered the profile invisible and unsearchable to those who were not already connected with the account.

Now with the Legacy Contact feature, Facebook account owners can name who they want to manage their profile in their absence. This “heir” would immediately have access to friend requests, pictures, and the management of content on the profile page.

Or, for those who want their Facebook account to remain private, the Legacy Contact feature also gives users the option to request a full deletion of their account after death.

How to Add, Change or Remove a Legacy Contact

Facebook offers the following instructions to guide users through the process of naming a Legacy Contact:

  1. Click  in the top right of Facebook.
  2. Select Settings & Privacy, then click Settings.
  3. Click Memorialization Settings.
  4. Type in a friend’s name in Choose a friend and click Add.
  5. To let your friend know they’re now your legacy contact, click Send.

To change or remove a legacy contact, follow steps 1–2 above, then click Remove. From there, you can add a new legacy contact if you’d like.

If your account is memorialized, your legacy contact will be notified. Learn more about what a legacy contact can do. Note: You must be 18 or older to select a legacy contact.

Utilizing Legacy Contacts is an easy and straightforward way to let Facebook know how you want your private social media information to be handled after your passing.  If you have any additional questions about how to include your digital assets as part of your estate plan, please contact our Calabasas will and trust lawyers at 818-334-2805 to schedule an appointment.

Calabasas Trust Lawyers

Everything You Need to Know About Self-Settled Trusts | Calabasas Trust Lawyers

by Estate Planning

There are a lot of different estate planning and asset protection planning trusts out there: revocable living trusts, Medi-Cal asset protection trusts, and life insurance trusts are just a few of them. One type of trust that Calabasas trust lawyers find to be useful, though sometimes only in narrow circumstances, is a self-settled trust.

What is a self-settled trust?

A self-settled trust is used to protect financial assets, real estate, personal property, and business assets from future creditors. Like most other trusts, once these assets are transferred into a self-settled trust, they’re legally owned by the trust and not by you. A self-settled trust is an irrevocable trust, which is the key feature in making sure that future creditors cannot reach the assets that are in the trust.

What are the limitations of a self-settled trust?

As mentioned earlier, there are a few limitations to self-settled trusts. The biggest limitation is the fact that they cannot protect assets from past creditors, so any debts incurred before the trust is created are still liable to be paid out from trust assets. Self-settled trusts are also not allowed in a number of states, as many lawmakers were worried that these trusts could be used to wrongfully avoid creditors. Self-settled trusts are legal in the following states:

·       Alaska

·       Delaware

·       Hawaii

·       Mississippi

·       Missouri

·       Nevada

·       New Hampshire

·       Ohio

·       Rhode Island

·       South Dakota

·       Tennessee

·       Utah

·       Virginia

·       West Virginia

·       Wyoming

How do I create a self-settled trust?

If you live in one of the states that allow self-settled trusts and want to create one to avoid future creditors, your first step should be to speak with an attorney who has experience with drafting self-settled trusts. Once you’ve chosen an attorney to create your trust, you’ll have to provide the following information:

·       The creditors from whom you want to protect your assets. Many people choose self-settled trusts if they worry about possible accidents or injuries, work in high-risk professions with liabilities, or own a business.

·       The trustee of the trust. You cannot choose yourself as the trustee of your own self-settled trust, since that defeats the purpose of the assets no longer being in your control. You’ll need to choose someone you trust or a corporate trustee who can fulfill those duties.

·       The assets that will go into the trust. Typically, people will put financial assets and real estate property into their self-settled trust, but everyone’s individual situation is different. You should bring a list of all your assets when you meet with your attorney so you can better determine what assets will go into the trust.

If you’d like to learn more about self-settled trusts and how one can fit into your estate plan, or if you currently have a self-settled trust and would like to have it reviewed by one of our experienced Calabasas trust attorneys, please contact us at (818) 334-2805 to set up a consultation.Report

Calabasas Elder Law Attorneys

Calabasas Elder Law Attorneys: Everything You Need to Know About Reverse Mortgages

by Estate Planning

There are many options available to seniors who would like access to liquid assets, and reverse mortgages are one of the most common – and misunderstood. Our Calabasas elder law attorneys have outlined everything you need to know about reverse mortgages, so you have the information you need to make the best choice possible.

What is a reverse mortgage?

A reverse mortgage is a financial tool available to seniors aged 62 and older who own their homes. It allows them to use their home equity as collateral to receive a lump sum, line of credit, or annuity to receive money. This makes the homeowner the borrower and the bank the lender, which means that interest will need to be paid on the monthly repayments to the lender.

When is the reverse mortgage loan due?

Typically, the borrower is responsible to make monthly payments to the lender until the amount that is borrowed is paid back. However, there are certain circumstances where the entire amount of the loan could be called due:

·       The borrower lives in a different primary residence. You must live in the home if you have a reverse mortgage, even if you still own the home. The lender will call the loan due if you rent out the home or move out for any other reason.

·       The borrower does not live in the home for 12 consecutive months due to health reasons. A senior suffering from health conditions who moves into a nursing home must move back to the home within 12 months, otherwise, the loan will be due.

·       The home is sold. The loan will be called due if the borrower either sells the home or transfers the title of the home to another person who is not also a borrower of the reverse mortgage.

·       The borrower passes away. There are cases where a non-borrowing spouse may be able to remain in the home after their spouse passes away, but certain conditions must be met. It’s best to speak with an experienced elder law attorney to find out how to avoid leaving the house if the loan is called due upon the passing of a spouse.

·       The loan agreement is breached. Reasons for a loan breach included non-payment of property taxes, a lapse in homeowner’s insurance, or if the house falls into disrepair.

Obtaining a reverse mortgage could be beneficial in certain circumstances, but as we listed above, there are a lot of different issues you should be aware of before you take out a loan. It’s best to consult with an elder law attorney who has experience with reverse mortgages to find out if taking a loan is best for you.

If you’d like to learn more about reverse mortgages and how they can impact estate planning, or if you have a reverse mortgage and want to have your existing estate plan reviewed, please contact us at (818) 334-2805 to set up a consultation with one of our Calabasas elder law attorneys.