Estate Planning

Crisis and Estate Planning Documents

Published on: March 14, 2022 | by Ettinger Law Firm

The 2020s have been filled with tension. First, in 2020, the Covid-19 pandemic emerged. Then, race tensions hit an all-time high following the death of George Floyd and several others. Now, the invasion of Ukraine has left many people in more difficult situations than ever before. All of these events are enough to make even the calmest person uneasy.

The most seasoned estate planning professionals are used to addressing two major sources of uneasiness with clients: death and taxation. Planning for these certain events will help to reduce the uneasiness that a person feels. While it’s impossible to control the future and the state of the world, people can engage in thorough estate planning and be fully prepared for any complications that might happen and impact their estate plans.

Estate planning frequently attempts to pass or minimize risk. Some of the most helpful risk-avoiding or risk-shifting techniques that people utilize in an estate planning environment include:

Demand for Estate Planning Increases As More Millennials Become Caregivers

Published on: March 14, 2022 | by Ettinger Law Firm

As the country enters a third year of living in a pandemic, estate planning is seeing an increase in millennials who are surpassing the baby boomer generation as the generation who performs the most caregiving for both children and aging parents.

Millennials are creating their own families, while simultaneously caring for their aging parents during a pandemic. This, in turn, is leading more caregivers to plan for the future. Even though millennials are taking responsibility for writing wills and creating trusts to establish families’ financial status, most adults in the United States lack an estate plan. Hopefully, by making digital estate planning as easy as possible, more people will create estate plans that achieve their wishes.

Key Findings from the Study

Hidden Estate Planning Advantage to This Year’s IRS Filing

Published on: March 10, 2022 | by Ettinger Law Firm

This year’s tax filing season has some hidden advantages. Amidst a backdrop of the Covid-19 pandemic and current tax laws, the Internal Revenue Service has predicted over 160 million Americans could start filing their federal tax returns at the end of January 2022. In regards to gift returns, this does not appear to be as nearly as problematic. The challenges primarily involve individual returns. Among the various tax strategies that clients have been using this year include under-the-radar trusts.

In 2021, donors could give up to $15,000 to another person like a friend or family member without this amount is subject to taxes. Each spouse in half of a married couple could utilize this limit to pass on assets to beneficiaries. Internal Revenue Service returns for many gifts over the threshold (As well as some under this threshold) are due on April 18, which is the same deadline that individual tax returns are due this year. Additionally, tax-payers can pursue an automatic six-month extension for both of these returns.

The Role of Annual Gifts

4 Estate Planning Strategies to Protect Your Assets

Published on: March 10, 2022 | by Ettinger Law Firm

Considering that someday you will no longer be alive is an unpleasant thought. You might be frightened of the unknown, particularly when it involves issues of what will happen to your loved ones. Even though you will no longer be around to play a role in managing your estate, you do have an input in what happens to your estate after you pass away. This article reviews some of the helpful things that you can do to protect your money after you pass away.

A vital part of estate planning is creating a will, which is a type of legally-binding document that articulates your wishes for what should happen after you pass away including who you would like to manage your estate and how you want your assets to be divided. Wills can also include instructions regarding the care of any dependent or pets that you might have.

A poll conducted in 2021 revealed that less than half of the adults in the United States have a will. The results of this study are similar to other polls conducted as early as the 1990s. Even though it can be challenging to consider that you will someday pass away and to place instructions regarding how your family should manage your assets, doing this can be critical to making sure that your assets, as well as your loved ones, remain protected after you pass away.

The Importance of Reviewing Digital Asset Estate Plans

Published on: March 10, 2022 | by Ettinger Law Firm

The world has changed substantially over the last few decades including in regards to estate planning. Even if you have a detailed estate plan, reviewing and updating the terms of the estate plan as appropriate is still critical. Due to advances with healthcare, more people are living longer and understandably need a wider range of options with their estate planning documents.

This article reviews some of the areas in the estate planning documents that most commonly need to be updated.

# 1 – Digital Assets

Reasons to Write an Electronic Will Regardless of Age

Published on: March 1, 2022 | by Ettinger Law Firm

While we don’t like to confront the thought, none of us lives forever. When we pass, we understandably want to leave as manageable a situation as possible for our loved ones. If we fail to create estate plans, our loved ones can end up facing many obstacles.

Understandably, we want the estate planning process to be as quick and easy as possible. While online estate planning options are widely advertised, these choices often leave people with various questions including whether the documents will hold up in court, whether the electronic documents will conform to state law, and if the documents will successfully achieve your estate planning goals.

This article reviews some issues with electronic estate planning documents that people commonly wonder about.

Estate Plans Should Contemplate Pets

Published on: March 1, 2022 | by Ettinger Law Firm

Many people find great enjoyment in sharing their life with a pet. Data reveals that about 90.5 million families in the United States own pets. For both people who are natural caregivers and those who require a pet’s companionship, pets can introduce a great sense of belonging to people. The consideration of pets is routinely overlooked when anticipating death and incapacity, though.

Consider Your Pet’s Specific Needs

When creating a trust or last will and testament, the needs of specific animals should be considered. Passing on responsibilities associated with small pets that live indoors is substantially different than requesting someone watch barnyard animals. You should consider who might be able to act as a future caregiver for your pet. Remember to be realistic about how this person will likely handle taking care of your pet.

Estate Planning Lessons from Rain Man

Published on: March 1, 2022 | by Ettinger Law Firm

The 1988 film Rain Man was directed by Barry Levinson and is cited by many people as a favorite film. Rain Man tells the story of Charles Babbitt (Tom Cruise) who finds out that his estranged father has passed away and left all of his large estate and its associated assets to the other son, Raymond (Dustin Hoffman), who is an autistic savant. Only after the father passes away does Charles Babbitt learn of Raymond’s existence. Rain Man shines some interesting issues in regards to estate planning and many people have questions about how the movie would play out in real life.

In the real world, Sanford Babbit would likely meet with his estate planning attorney before his death. Sanford would likely inform his lawyer that he has two children at this point. Sanford would also likely tell the lawyer that he had placed his autistic son in a private care facility for individuals with intellectual disabilities. Sanford would also likely express a legitimate concern about Raymond and his desire to make sure that his son can always live at this facility and remain protected.

A knowledgeable attorney would likely recommend that Sanford establish a revocable trust. Following Sanford’s death, the trust would continue for the benefit of Raymond, while also potentially making annual distributions to Charlie. Following Raymond’s death, the trust would then be distributed to Charlie. Sanford would also likely execute a no-content clause stating that if Charlie seeks to argue or place aside the trust or Sanford’s will or disrupt Raymond’s situation, annual distributions to Charlie would be discontinued and the trust is passed from Charlie to the facility when Raymond passes away.

Minnesota Case Emphasizes Important Trust Management Lessons

Published on: February 21, 2022 | by Ettinger Law Firm

In a recent opinion, a Minnesota Appellate Court rejected a petition to revise a trust’s terms to permit the early distribution of trust assets to beneficiaries. The court also rejected a request by the petition for the trust to pay attorney’s fees and held that the litigation was neither necessary nor existed for the benefit of the trust. This opinion functions as a reminder of the high threshold that a person must overcome when beneficiaries attempt to revise a trust’s distribution terms.

The Court’s Decision

In Skarsten-Dineman v. Milton, a trust settlor established a revocable naming his six children as the primary beneficiaries following his death. Assets were to be passed to the man’s children until three of them had passed away then the trustee was to end the trust and pass on the principal equally divided to the surviving children.

Riverside v. Snukst: A Lesson on How to Avoid Trust Disputes

Published on: February 21, 2022 | by Ettinger Law Firm

In the recent case of Riverside County Public Guardian v. Snukst, a California appellate Court resolved an issue involving the Medi-Cal program, which is California’s version of the federal Medicaid program. The program is overseen by the California Department of Health Services. In Riverside, the Department of Health Services pursued payment from a revocable inter vivos trust for the benefits provided on behalf of a person during his life. After the man’s death, the probate required the assets in the revocable inter vivos trust be passed on to the sole beneficiary instead of the Department of Health.

The Court of Appeals determined that federal and state law involving revocable inter vivos trusts required the Department of Health receive funds from the trust before any distribution to the beneficiary. Subsequently, the judgment was reversed and remanded.

For trusts to work as a person wants, the trust must avoid future disagreements and disputes among those impacted by the trust’s terms. This article reviews some of the best things that you can do to avoid trust disputes.