True estate planning is a means of defining personal values. Your legacy tells the story of your life and all that you have accomplished. Who you pass your legacy on to is a way of illustrating not only who you care about, but who you trust to shape the future with everything you have worked to build. Estate planning allows you to prioritize what you cherish most and to determine how you’d like it to be cared for in the years to come. It is imperative, then, to ensure not only that your financial resources are protected, but that you and your loved ones are empowered along every step of the way.
SECURE YOUR FINANCES
By preparing for your passing in advance, you are able to shelter your family from unforeseen financial hardships. Inherited vehicles, real estate, bank accounts, investments, life insurance and personal possessions are all subject to probate, taxes and legal fees, potentially placing a burden on those you love most. Proper estate planning under the guidance of an experienced attorney can ensure that your finances are budgeted effectively and that your family is left without any unnecessary stress.
CARE FOR THOSE YOU LOVE
In addition, estate planning allows you to control how your beneficiaries are cared for once you’re gone. Without a documented plan, the state has a right to decrease funding for those on government entitlements when they receive an inheritance. Unless otherwise specified by the benefactor, the government will also take supervision over all inheritances for minor family members. Don’t be one of the many who has fallen into these traps due to poor planning. You deserve to have a say in how your loved ones are provided for.
CONSERVE YOUR BUSINESS
Furthermore, if you have worked to establish a business, it is your right to assure that it is passed on to those you trust. Estate planning is the easiest way to foster a handoff in ownership. My background in business entity formation has provided me with a solid understanding of business law and acumen, and I am confident that I can assist you in facilitating a smooth transition.
ESTATE PLANNING BENEFITS EVERYONE
Although estate planning is thought of as essential for those with large net worths, individuals with modest assets often benefit the most, as they can afford to lose the least. Without proper estate planning, probate laws will dictate when and to whom your assets are allocated, and they will increase costs tremendously. That’s why I am committed to designing plans that meet the individual needs of my clients.
Many dismiss these crucial preparations as tasks to undergo when they reach retirement. However, I assure you that it is best to form a plan early in your adult life. My approach to estate planning is fluid. I enjoy building relationships with my clients and adjusting their plans over time as their needs and priorities progress. Having a sense of peace about your future allows you to live freely in the present day. That’s the reason I have devoted my career to assisting families with estate planning. I am here to be your adviser, your ally. Let’s build you and your family’s future together.
Life is a series of choices, but what would happen in the event that you were no longer able to make those decisions on your own? Many individuals choose to grant an agent, i.e. a child or spouse, power of attorney (POA) for this very reason. Electing a power of attorney to someone you trust ensures that you are well taken care of. Your agent will prevent you from being mistreated or subjected to situations you would not have chosen for yourself. Often, an agent such as this will assist you in your later years, but there are numerous other instances where a helping hand may be beneficial.
FREQUENTLY USED TYPES OF POWER OF ATTORNEY
General POA, sometimes referred to as a "financial" POA, allows an individual or organization to make a broad variety of decisions on your behalf. Typically, a general power of attorney is necessary when you are out of the country or physically or mentally incapable of handling your own affairs. Financial investments, life insurance purchases, claim settlements and business operating decisions are simply a handful of matters an agent with general power of attorney may coordinate on your behalf.
Limited POA gives you the authority to specify exactly what matters your agent of choice may handle. Individuals routinely find a limited power of attorney useful when selling real estate, collecting debt and handling business interests.
Healthcare POA permits an agent to navigate your medical care dilemmas if you are unconscious, mentally incompetent or otherwise unable. You may also spell out your desired wishes ahead of time in a living will. For more information, see Living Trusts and Wills.
Springing POA is only valid after you become incapacitated.
Durable POA takes effect immediately and ensures that your agent may continue to act in your interest for the remainder of your life. Thus, it is an essential aspect of proper estate planning.
DANGERS OF HANDING OVER LEGAL CONTROL
Granting an inappropriate type of power of attorney or issuing POA with unclear documentation can place you at great risk. When you grant someone general power of attorney, for instance, that person then has the ability to borrow money, access your bank accounts, sell your personal property, purchase real estate and enter into legal contracts under your name. Therefore, it is unwise to hand over legal control without the knowledge and expertise of a trained attorney.
HOW TO BEST MANAGE POWER OF ATTORNEY
Although there are several types of power of attorney, they all ultimately serve the same purpose: providing you with reliable care and protection. It is your agent’s responsibility to maintain accurate records of all transactions and keep you (or an agreed upon third party) informed at all times. That being said, these are a few things you should consider in order to ensure you are best represented:
If at any time you wish to revoke legal control, notify your agent in writing, retrieve all documents which originally granted power to the agent and contact the County Clerk’s office, as well as all financial institutions, regarding your decision.
The need for power of attorney is almost an inevitable part of everyone’s life. Therefore, it is best to secure an agent to act on your behalf before one is absolutely needed. I realize these decisions can be difficult and that it can be worrisome to ponder the idea of handing over control. However, I can assure you that I am here to help you through every step of the way. My clients rely on me to provide counsel on their candidates and to make sure that all written records meet the necessary legal requirements. I would be honored to walk the same journey toward care and protection with you.
When a loved one passes on, the last thing on your mind is how to account for their assets and report your findings to the government. You need space to grieve and seek closure, but unfortunately, the law requires that a final accounting be done within a short period of time. Aside from beneficiary designations available on some assets, Estate Administration and Trust Administration are the two most common methods of passing assets to loved ones.
Estate administration is carried out to verify the validity of the decedent's last will and testament, or to aid in the distribution of assets in the event that no estate planning documents are present. Probate is conducted in the probate court and can take anywhere from months to years to fully complete. In order to conclude the process, several key actions must be taken.
The first step of probate is validation of the will. An application must be filed at the probate court in the deceased person’s last county of residence. At this time, the court will verify the validity of the will. Next, an executor must be appointed. The executor is the person who will gather and guard the decedent's assets, pay debts and taxes, and distribute assets following the terms of his or her will. Following the appointment of an executor is the inventory of the estate. At this time, all assets must be appraised to determine the estate’s total value. Debts and taxes must then be paid before asset distribution may occur. Once all other matters have been attended to, the executor will file a final account and the decedent's beneficiaries may receive their inheritances as designated by the will.
Trust administration involves many of the same steps as probate but is typically cheaper, quicker and less work simply because there is less involvement with the courts. Therefore, it also offers more privacy. Still, there are key steps that must be carried out to ensure all loose ends are tied.
Just as in probate, all assets must be appraised to determine their value at the beginning of trust administration. After taxes are dealt with, assets may then be distributed according to the trust.
PREVENTING OBSTACLES IN ASSET DISTRIBUTION
It is important to note that creditors have six months from the date of death to file a claim with the executor (or fiduciary) of the estate. The catch here is that the executor with whom a claim must be filed must be appointed by the court first. This means that an executor can wait until 6 months after the date of death before applying to be executor and, as long as nobody else has been appointed executor, no claims can be made against the estate! (with some exceptions)
In addition, there are some problems that may occur during the probate and trust administration process. At times, beneficiaries may feel entitled to a larger share of assets than the will or trust provides. They may even believe the deceased was coerced, tricked or unfairly influenced when the document was created. Others may disapprove of the appointed executor and propose that someone he or she believes to be more competent take over. I have also encountered individuals who suspect that their loved one’s will or trust does not conform to legal standards. These are all difficult situations to navigate, but I am here to guide you and your family with my knowledge and experience and resolve any issues that arise along the way.
One of the most crucial aspects of life is the ability to protect the future of you and your family. How would you like to spend your final years? How would you like to provide for your loved ones, then and thereafter? These are important questions to ask yourself when envisioning your life’s path. However, answering these questions is merely the beginning. You then must choose whether to solidify your plan in a will or trust. For many of my clients, this the trickiest step, so I’d like to give you a brief overview of each type of document so that you may begin to form an idea about what may best suit you and your family’s needs.
Living wills are a type of advanced healthcare directive. They state your wishes regarding medical treatments that prolong human life and do not take effect until you are incapacitated. Living wills allow you to appoint power of attorney to someone that you trust so that he or she may direct your healthcare decisions when needed. Because they are completely unrelated to your financial assets, most choose to draft an additional document, such as a trust, power of attorney or last will and testament, to detail their arrangements for the years to come. For further information, see Power of Attorney.
Trusts outline the rules you want followed for the assets in holding for your beneficiaries. There are two main types of trusts: revocable and irrevocable. Revocable trusts allow you to maintain ownership of your assets while you are alive. Irrevocable trusts, on the other hand, require you to delegate ownership of your assets to your heirs immediately but some benefits are creditor and governmental protections. One of the biggest advantages of trusts is that they can prevent your family from having to undergo the probate process at the time of your passing. However, they are initially a larger investment and require more information at the planning stage than a last will.
ADVANTAGES OF A TRUST
Initially, a trust is helpful because it provides you with a comprehensive document that is easily amendable. A trust also prevents the need for a guardianship, which is the legal process of appointing a guardian at the time of mental incapacity. A trust later prevents your family from having to complete the probate process after you have passed on and ensures that your financial information and final wishes remain private. Furthermore, trusts give you the freedom to appoint yourself or an industry expert, such as a financial planner, as the first trustee. With a trust, you may stretch out distributions to beneficiaries over a period of time and protect your heirs against creditors and those who may wish to prey upon them financially.
DISADVANTAGES OF A TRUST
Unfortunately, a trust does not come without its share of downfalls. Most importantly, a trust will cost more at the initial stage of planning and you have fund the trust up front; this means looking at all beneficiary designations and re-titling some assets.
LAST WILLS AND TESTAMENTS
Last wills and testaments outline the distribution of all assets that end up going through the probate process. In you last will, you will nominate an Executor and, if you have minor children, a Guardian for your children.
ENSURE YOUR VOICE IS HEARD
In conclusion, both wills and trusts allow you to coordinate not only how your assets will be distributed after you pass on, but how you and your family will be cared for in the future. While I hope that this information has helped you begin to ponder your estate planning needs, I strongly recommend that you design your estate planning documents under the guidance of a trusted attorney. Typos and small errors can obliterate a person’s intent. Furthermore, it is imperative that these documents are clear and legally sound as conflicts can arise when beneficiaries disagree about the legitimacy of the document or your intentions. Remember, THINGS CHANGE WHEN PEOPLE DIE, and your intentions should be clearly laid out in legally binding manner to reflect and enforce your intentions.
Starting a business is a way of fulfilling your life’s purpose. Whether you’re looking to form a startup or restructure an existing company, you probably spend much of your time envisioning your goals for the future. You have a vision, but you also need a legal plan that gives you the freedom to achieve your highest mission. It is wise to decrease your exposure to liability and to limit your tax burden so you can afford to allocate more resources to your true objectives. No matter the size or age of your organization, there is a type of formation that is right for you.
INDEPENDENT LEGAL STRUCTURES
C corporations, S corporations and limited liability companies (LLCs) are all considered independent legal structures. They prevent you from being held personally liable for legal actions taken against the company and separate your personal assets from your business debt. However, C corporations are unique in that they are taxed on corporate profits and shareholder dividends. The owners of S corporations and LLCs must report their shares of profit and loss in the company on their personal tax returns. C and S corporations must also hold annual meetings.
TYPES NOT CONSIDERED INDEPENDENT STRUCTURES
Partnerships and sole proprietorships are not classified as structures separate from their owners. The owners of these entities remain personally liable for lawsuits filed against the business. Additionally, owners must report their shares of profit and loss in the company on their personal tax returns. There is no true distinction between personal assets and business debt. These structures typically do not require state filing and are easy to form and operate. The owners of these entities are also not mandated to hold annual meetings. Therefore, partnerships and sole proprietorships are good options for those seeking a high degree of flexibility.
WHAT TO DO BEFORE STARTING A BUSINESS
Deciding what type of business entity to form is merely one piece of the puzzle. There are several tasks every organization must do, ideally before they ever begin operation. Below is a list of duties that you should check off with a trusted attorney before doing anything else.
-Obtain a business license.
-Get an employer tax ID.
-File sales and transaction privilege tax reports.
-Protect your trademark or trade name and finalize any patents.
-Purchase worker’s compensation insurance.
-Create an operating agreement that governs the rights, obligations and responsibilities of every employee in your organization.
-If under ownership by two or more people, outline procedures for how you and your partners should sell interests to one another should you decide to part ways down the line or die.
PROTECTING YOURSELF AND YOUR COMPANY
Although some of the above tasks appear simple, they can place you and your business at great risk if they are not carefully implemented. Many find it helpful to form a relationship with a trusted attorney early in their company’s lifespan. You will inevitably need to seek legal counsel as your business grows and encounters expanding needs, and it is most effective to gain this insight from an attorney who knows you and your business and has taken the time to understand your mission.
If you’re like most, real estate is the single greatest purchase you will make in your lifetime. After all, a home or business is not only a significant financial investment—it is also the place you will spend the majority of your time. It is where you will create memories, form relationships and carry out the bulk of your daily duties. Therefore, it is a purchase that requires detailed research and prudent planning. However, real estate is not simply a “buyer beware” domain. Sellers can easily encounter pitfalls, too. Unfortunately, a small oversight in a real estate transaction may put a damper on your plans and land you in legal trouble.
COMMON PROBLEMS FOR BUYERS
Financing, purchase agreements and latent defects are the largest sources of frustration when purchasing real estate. First, you must obtain a loan. This can be challenging for those with even a moderate credit score. If you cannot qualify for a loan at the time of purchase, an attorney may be able to help you enter into a land contract with the seller. A land contract allows you to pay the seller in installments and states that the seller must transfer the title to you when you make the last payment. However, even if you do obtain a traditional mortgage and purchase agreement, you must read over them carefully. Some may incorporate balloon interest rates or list clauses which state that the seller may retain the property and keep your earnest money if you postpone the closing date by even one day. Worse yet, some properties contain hidden problems that are not easily identified during a routine inspection. You must consider what plan of action you will take if latent defects are found, or if the seller does not complete agreed upon repairs.
Title searches, liens and zoning regulations may also pose trouble for buyers. Although the process of finding and verifying the validity of a seller’s title is generally a relatively simple step in a real estate transaction, it does require the assistance of a professional. A title company may be able to serve up the necessary document, but you should consult an attorney to ensure that it is legally valid. Those looking to acquire land must also be aware of liens and zoning laws. Liens give an entity the right to maintain possession of the seller’s property until a debt is settled, and zoning regulations govern the kinds of structures and activities allowed on the lot of land you’re seeking to obtain.
COMMON PROBLEMS FOR SELLERS
For sellers, tax liability and brokerage contracts are often two of the biggest worries. When you sell a property, the amount of income tax you’ll owe that year may increase dramatically. Fortunately, there are certain tax provisions that can potentially hedge against these costs. An accountant or attorney can help you identify whether or not you meet the criteria for such provisions. Furthermore, he or she will verify that the brokerage contract is written to protect you in case a sale does not occur. In some cases, brokerage contacts originally state that a brokerage fee must be paid even if a buyer is not found. An attorney will ensure that this does not happen to you.
OTHER REAL ESTATE DILEMMAS THAT REQUIRE LEGAL ASSISTANCE
HOW AN ATTORNEY CAN HELP FACILITATE YOUR TRANSACTION
Although a realtor is licensed to direct nearly all aspects of a sale or purchase, it is not always effective to hire an agent when buying or selling real estate. First and foremost, conflicts of interest may arise when working with a buyer’s agent due to the nature of how they are compensated. Given that agents are paid on commission, it is within their best interest to close a sale as quickly and for as much money as possible, which can be to your detriment if you are the buyer. They also may avoid showing you “For Sale by Owner” (FSBO) properties. Furthermore, realtors often use standard forms which are not easily tailored to meet your unique needs. They may even unintentionally overlook legally binding errors due to the complex language of many real estate contracts. Thus, in order to receive fair and sound advice, some find it beneficial to seek the counsel of a trusted attorney rather than a real estate agent.
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