November 17, 2016February 23, 2026

Steps to Get an Estate Plan

Getting an estate plan often seems more difficult than it is. If you follow a few basic rules and steps, then you can get a good estate plan with little hassle.

Many people have the mistaken idea that getting an estate plan is an overly complicated process. They let this idea stop them from doing their own planning and they just keep putting things off.

However, estate planning does not have to be complicated.

Recently Personal Liberty offered some tips to simplify things in “Nuts and Bolts of Estate Planning,” including:

· Organize all of your financial and asset documents so you know what you have and what you need to plan for.

· Make the important decisions about who you want to have your assets and how much everyone should get.

· Think about how your heirs might disagree and how any conflicts can be avoided.

· Your plan does not need to be perfect. You will not be able to create a plan that pleases everyone completely.

· Whenever possible keep your plans flexible so they are easy to change when circumstances change.

· Make sure you are choosing responsible people to act as your executor and trustees.

· Do not surprise your heirs with too much. If you are planning something unusual, it is a good idea to let them know.

An experienced estate planning attorney can help you avoid missteps.

Reference: Personal Liberty (Oct. 28, 2016) “Nuts and Bolts of Estate Planning.”

November 15, 2016February 15, 2024

Convincing Parents to Create Estate Plan

Many children with aging parents know that their parents should do estate planning, but convincing their parents of that can be difficult.

Many elderly people in the U.S. believe estate planning is something only the very wealthy need. If they only have a few major assets and modest back accounts, then they believe estate planning is unnecessary for them.

Many of their adult children know better, however.

The children know estate planning is an important responsibility for everyone regardless of wealth. While those children would like to talk their parents into estate planning they may find it difficult. In the Washington Metropolitan area, estate planning is very important. Maryland estate planning is critical because Maryland has both a state estate tax and a state inheritance tax. The District of Columbia also has a state estate tax.

This topic was addressed by NJ 101.5 in “Talking to your parents about a will.”

If you find yourself having this problem with your aging parents, there are some steps you can take.

First, explain to your parents that without an estate plan their estates will have to go through probate and everything will be distributed according to state law and not your parents’ wishes. That means if they would like to leave something directly to their grandchildren, they will not be able to do so in most cases. It also means that they might be subject to Maryland or D.C estate planning axes.

You can also talk to your parents about how costly and time-consuming probate can be and how it could be a burden on the family.

If all else fails and you can afford it, you might offer to pay for your parents to visit an estate planning attorney. They do not have to commit to anything before seeing the attorney, but the attorney can discuss the benefits of estate planning with your parents and give them some options. At Profit Law Firm, we also conduct two generation family planning sessions. Contact us for a consultation with Maryland estate planning attorneys and DC estate planning attorneys.

Reference: NJ 101.5 (Nov. 1, 2016) “Talking to your parents about a will.”

October 28, 2016

Giving Charity to Specific People

If you would like to make a charitable gift to a specific individual, you can. However, you should be aware that there are rules that need to be followed.

There are all kinds of people in the world who are in need of charitable assistance. Fortunately, there are many others with the means and desire to provide that assistance.

The normal method of donating is to give to an established charitable organization and to let them sort through the people requesting assistance and donate to those most worthy. What if you have found a particular individual you would like to help directly? Certainly you can give to him or her. However, if you hope to deduct the donation from your taxes, then you do need to be aware of the rules.

The Wills, Trusts & Estates Prof Blog discussed this issue in "Charitable Giving to Individuals."

If you are hoping to give to someone directly, then they need to have a private foundation pre-approved for the purpose. Furthermore, you need to be able to prove that you chose to give to them in a fair and non-discriminatory way. You cannot, for example, just give to someone who a co-worker knows needs money for educational expenses and deduct it from your taxes.

To best cover yourself you will probably need to have developed a grant application for the person to fill out.

You might consider just using your gift tax exemption to give to specific people as that would be a lot easier. Make sure you talk to an estate planning attorney first because large gifts should only be made with your estate plan in mind.

Reference: Wills, Trusts & Estates Prof Blog (Oct. 5, 2016) "Charitable Giving to Individuals."

October 25, 2016May 1, 2023

Family Business Succession Planning

If you have a family business that you want to leave behind for your children or grandchildren, it is important that you not only plan ahead, but that you also start easing the way for the transition.

Any estate plan is going to be more effective the more you plan ahead for what might happen and the more you prepare your heirs for what property and responsibility they will receive. However, for most estate plans that is not absolutely necessary.

Most estate plans will still work out fine if you wait to make plans and do not tell your family what will happen. But, estate plans that include a family business are different. They will not work out so fine.

It is vital that you plan ahead for them as the Wills, Trusts & Estates Prof Blog writes in “Preparing the Family Business for Succession.”

For the family business to thrive after the current owner passes away, careful plans must be made for who will be in charge next. Everyone needs to know who will be in charge on day one and, to make that go as smoothly as possible, it is important that the next leader knows what he or she is supposed to do.

Ideally, the next leader should be groomed for the role by taking part in the business on a day-to-day basis and making decisions about it sooner rather than later. Even if all that is done, it is important to plan for any contingencies that might occur. A secondary plan for succession should also be in place.

If you have a family business, do not delay. Talk to an estate planning attorney about how you can make sure it succeeds when you are no longer running it.

Reference: Wills, Trusts & Estates Prof Blog (Oct. 6, 2016) “Preparing the Family Business for Succession.”

October 19, 2016October 25, 2023

Post Death Termination Fees

Families and estate executors have enough to worry about after someone passes away. Should they also have to worry about termination fees for canceling a contract with a utility? One state says no.

If you have ever wanted to move to a different cell phone provider, you are likely to have come across a problem. As long as you signed a contract with your current provider, you either have to continue to pay the contract or pay a termination fee.

Depending on where you live, you might have come across other termination fees for things such as cable, electricity and garbage service. These fees are normally seen as reasonable as long as the person who signed the contract is alive. However, some people have discovered that some companies refuse to waive the fees even if the person who signed the contract has passed away.

These post-death termination fees can put a real strain on many small estates. If the deceased had few assets, even a fee of a couple of hundred dollars can be difficult for the estate to pay.

The state of New York has decided to address this problem and recently passed a law that prohibits utility companies from charging termination fees after the contract holder has passed away.

Fox 5 reported on this new law in “NY: Utilities can’t charge termination fees after death.”

This small law could provide big relief to families who are going through the difficult process of grieving for a deceased loved one. In turn, the new law should not create an undue burden on the companies. It remains to be seen if other states will follow suit.

Reference: Fox 5 (Sept. 28, 2016) “NY: Utilities can’t charge termination fees after death.”

October 10, 2016July 26, 2024

Locating Old Retirement Accounts

People with old pensions and retirement accounts often have difficulty locating them. It can be more difficult for estate administrators who need to locate the old accounts. Some help might be on the way.

When pension plans first became a popular benefit in the U.S. it was normal for people to stay employed by the same company throughout almost their entire working life. This held true when employers began switching from traditional pensions to 401(k) accounts. However, that is no longer the case for many working Americans.

People today change employers frequently.

That often means they have old retirement accounts setup at previous places of employment. If someone is not diligent in transferring those accounts when they change jobs, the old accounts can become forgotten or lost. That can make it difficult to later find those accounts when needed, such as when retiring or administering an estate.

This problem was discussed in a Wills, Trusts & Estates Prof Blog article titled “How to Find Your Lost 401(k).”

Currently the U.S. Pension Benefit Guaranty Corp. has a database of traditional pension plans that allows people to find any lost accounts. The agency would like to make that database easier to search and would like to expand it to include defined-contribution pensions and 401(k) accounts.

However, for now, inclusion of 401(k) accounts would be voluntary and there are other companies attempting to corner the market. A bill is in Congress that would make it mandatory to create a nationwide searchable database.

If you have old retirement accounts you cannot locate, you might want to contact your representative in Congress to urge passage of the bill.

Reference: Wills, Trusts & Estates Prof Blog (Sept. 20, 2016) “How to Find Your Lost 401(k).”

October 6, 2016

What Is Your Estate Planning Attorney Talking About?

Estate Planning Attorneys talk about a lot of different legal documents. You need to know what those documents are.

When you visit with an estate planning attorney, the attorney is likely to mention the names of several different legal documents. If you want to understand what the attorney is talking about, then you will need to know what those documents are.

Most attorneys would be happy for you to ask if you do not know. Answering questions is what the attorney is there for. However, if you are not comfortable asking basic questions, then you should learn some basics beforehand.

Recently, the Ventura County Star published a list of basic estate planning documents and what they do in "Get to know estate planning documents." The list includes:

Advance Directive – Tells doctors and other health care professionals what procedures not to perform if you are terminally ill and have no chance of recovery.
Asset Inventory – A list of all of your assets to let your estate executor know what you have after you pass away.
Beneficiary designations – Life insurance, retirement accounts, and other financial accounts you designate to go to a specific person after you pass away.
Power of Attorney – Allows for someone else to handle your finances if you are incapacitated.
Power of Attorney for health care – Allows for someone else to make medical decisions for you if you are incapacitated.
Record of Locations – A list of where your heirs can find all the important financial and legal documents after you pass away.
Trust agreement – A method of passing assets to others while having those assets maintained by a third person.
Will – The most common estate planning document that says how assets should be distributed after you pass away via probate.

A qualified estate planning attorney can help you decide the best legal documents to use for your unique circumstances.

Reference: Ventura County Star (Sept. 17, 2016) "Get to know estate planning documents."

September 2, 2016October 25, 2023

You Can Plan for the Unexpected

Estate planning is one of the few things that you can do to legitimately plan ahead for the unexpected.

In most walks of life it is almost impossible to plan for the unexpected. Even when you can, it is often a waste of time. No offense to Doomsday preppers, for example, but it is almost impossible and most likely a waste of time to plan for the zombie apocalypse. The chances of such an event happening in our lifetime are exceedingly slim and we do not really know everything we would need to survive such a thing.

Even in business it is often difficult to plan for the unexpected. If a business person does not expect something to happen, it is a waste of resources to plan for it. It is usually better to spend those resources growing the business.

However, as WXOW points out in “Planning ahead for the unexpected with a will,” estate planning is different.

With estate planning we can plan for the unexpected and it will never be a complete waste of time. Most of us do not expect to die anytime soon, but we all know that we will die someday.

If you get an estate plan now, you have not wasted your time even if you do not pass away for decades. At some point the estate plan will be used.

By estate planning long before you expect to need it, you hedge your bets just in case something unexpected does happen tomorrow, but you also plan for the inevitable.

Getting an estate plan does not have to be a difficult process.

If you hire a qualified estate planning attorney, then the attorney will do most of the heavy lifting. You can get an estate plan that will be good should you need it next week or sometime later this century. Get a head start with Profit Law Firm, a law office that focuses on estate planning.

Reference: WXOW (Aug. 5, 2016) “Planning ahead for the unexpected with a will “

August 30, 2016

Lawsuit over a Dog’s Trust Fund

Pet trusts have become an increasingly popular way for pet owner’s to make sure that their pets are taken care after the owner passes away. As with other types of trusts, they too can lead to disputes as a New York case illustrates.

When Patricia Bowers passed away in 2010, the care of her dog, Winnie Pooh, was given over to her friend Virginia Hanlon. Bowers also left a $100,000 trust fund for the care of the animal.

Hanlon has filed a lawsuit claiming that she has received very little of that money.

She claims that the estate executor, Harriet Harkavy, is intentionally saving the money that is supposed to go for the dog’s care so Harkavy can donate it to charity and win points within her social circle. Bowers also states that a check for an emergency veterinary bill bounced, but that she was later reimbursed with a valid check.

The UPI reported this story in “Lawsuit filed in New York over handling of dachshund's $100,000 trust fund.” For her part, Harkavy claims that Hanlon has received everything she is entitled to under the terms of the trust.

What this case illustrates is that trusts for pets need to be treated just like any other trust and other estate planning documents. It is important that everyone involved who has authority is on the same page and will be able to work out their differences.

Ultimately, the trustee must also be someone who inspires trust in the beneficiaries. If not, then disagreements are likely to lead to expensive and unnecessary lawsuits, which are the very things that good estate plans are designed to avoid.

Reference: UPI (Aug. 1, 2016) “Lawsuit filed in New York over handling of dachshund's $100,000 trust fund.”

August 23, 2016February 15, 2024

Avoiding Estate Mistakes

If you do not have an Maryland estate plan or have a bad plan, then it is likely that your loved ones will have a more difficult time than necessary inheriting your wealth. Fortunately, for most people getting a good Maryland estate plan is easier than they often think.

One of the many reasons people in Maryland put off planning for their estates is that they imagine it is much more difficult to do than it really is. For most people a good Maryland estate plan follows a simple formula. They need to decide who they want to inherit their property, hire an experienced Maryland estate planning attorney and have the appropriate documents drawn up.

Recently, Kiplinger wrote about four steps to take in “4 Strategies to Avoid an Estate-Planning Mishap.”

They include:

Get a basic will that details who you want to have your property and what they should have.
Create a living trust and put your most important assets in it. With a trust in place most of your estate will not need to go through probate after you pass away, which makes things much easier on your family.
Make sure all of your financial accounts are properly titled. Some you might want to put in your new trust. For others you can make them payable on death so they will automatically go to a person of your designation after you pass away.
Consider getting a life insurance policy. If your family is in need of cash after you pass away, they will have access to it through the life insurance benefit. This is a good way to make sure that your family has what it needs while waiting for your estate to be legally settled.

A qualified Maryland estate planning attorney can help you design – and implement – a Maryland estate plan appropriate for your unique circumstances.

Reference: Kiplinger (Aug. 2016) “4 Strategies to Avoid an Estate-Planning Mishap.”

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Tag: Estate Planning