Shawn McCammon (Liberty Law, A.P.C.) was just named Best Attorney in the annual “Best of” Tehama County, which is voted on by the readers of the Daily News. We would like to thank our friends, family, and clients for all their support! We are truly blessed, and we look forward to serving you for many years to come. Look for our thank you in the annual Best Of publication due out in the next week or two.Tweet
The recession has apparently kept even more Americans from completing any basic estate-planning documents — a will, trust or financial/medical powers of attorney, according to a December survey by Lawyers.com. Only 51 percent of adults reported they had such estate-planning documents, compared with 64 percent in 2007. Most cited their need to focus on paying bills and other “essential” money priorities, the survey said. This article discusses the family feuds that can happen when no estate planning occurs, and the importance of talking to your family about your estate plan as you begin to get your estate plan in order.Tweet
So says Representative Sander Levin. Ryan J. Donmoyer of BusinessWeek writes here that Congress may get to extending the Bush erea estate tax rate next month.
Excerpt from the article: Levin said the committee would begin work to retroactively reinstate a federal tax on multimillion-dollar estates that expired Dec. 31. The legislation would likely seek an extension of a 2009 law, which applied a 45 percent tax rate on the value of estates that exceeded $3.5 million per individual.
“The sooner we do it, the better,” Levin said. The lapse of the levy and a complicated capital gains tax that replaced it was making it hard for families to plan their affairs, he said.Tweet
There are two types of joint ownership, Joint Tenancy with Right of Survivorship (JTWROS) and Tenants in Common (TIC). Problems with JTWROS include postponement of probate until last tenancy, loss of the double step-up in tax basis, and outright distribution. Many couples take title to property by this method and don’t realize the potential consequences down the road. It’s important to remember that JTWROS does not avoid probate, it merely postpones it until the second spouse passes away.
Similarly, holding title as tenants in common, you also lose the double step-up in tax basis, and your property is subject to the estate plan of each tenant as well as probate for each tenant in the event that both parties do not have a comprehensive estate plan.Tweet
An “I love you” Will is one in which all the decedent’s assets have been left to the spouse. On paper, it might seem to be a caring, thoughtful gesture, but the reality is quite different. That’s because such a Will simply passes the complex issues and problems associated with transferring and protecting wealth onto the spouse or other loved ones. An “I love you” Will creates more problems than it solves, particularly for future generations. This type of estate plan can also fail to provide proper tax planning, costing the family thousand of dollars in unused tax exemptions available under the estate tax system.Tweet
If you die without a Will or some other form of estate planning, the state in which you reside and the IRS will simply make one for you. Of course, they have no interest in avoiding or reducing estate taxes, minimizing estate administration costs or protecting your family and legacy. The distribution of our assets will just be turned over to the Probate Court. The probate process is needlessly time consuming, frustrating and expensive. It is also open to the public, meaning creditors, predators or anyone else will have complete access to all information about your estate. For the vast majority of people, the benefits of a Will or other estate planning
tools far outweigh any initial costs.