Family

What You Don’t Know About Estate Planning Could Hurt Your Family

Published on: August 29, 2016 | By McCulloch & Miller, PLLC

Think of an estate plan as a love letter to your family after you have passed.

You’d be surprised at how many people you know don’t have a will or an estate plan in place. They may be among the many who have an unspoken belief that if they don’t have a will, they won’t die. That would be terrific—if it were true. Or, they think that only people who are wealthy or have complex tax issues require estate planning.

The Sabetha (KS) Herald’s recent article, “Understanding the estate planning process,” says that both of these ideas are wrong because your level of wealth and the ultimate tax consequences of your estate take a back seat to the planning and care of your family and other heirs.

How to Prepare for Long-Term Care Costs in Houston

Published on: August 15, 2016 | By McCulloch & Miller, PLLC

The cost of long-term care can take a huge bite out of retirement savings, exhaust family resources and create strain on relationships. Don’t count on Medicare, but do plan in advance.

At least seven out of ten Americans age 65 and over will need long-term care at some point. Most people simply underestimate the cost of long-term care, or they think that Medicaid will cover the costs. Your best defense against long-term care costs: advance planning with professional help.

The Memphis Daily News article, “Long-Term Care – Not for Everyone,” says that Medicare does little for these costs and only for a short time period. Medicaid doesn’t apply until the assets of an estate are spent down, so many people must pay for these costs out-of-pocket. The article says that there are only two ways to address these expenses: with your investment/retirement portfolio and with long-term care insurance. Most people review the cost of long-term care insurance and elect to roll the dice, but when that first round of expenses hits, they probably will wish they’d bought it long ago. Now it’s usually too late to buy it. If you can afford to self-insure, you can save your estate and yourself some serious money.

How to Address Giving Your Houston Home to Your Heirs

Published on: August 8, 2016 | By McCulloch & Miller, PLLC

Passing your home to your heirs can occur in a number of ways, depending upon your situation and your family. It’s not a do-it-yourself project—even in the simplest cases.

If you own a home and want to leave it to your loved ones, there are steps you need to take to ensure that your wishes are achieved. According to Fox News, “You're Going to Die—Here Are the Best Ways to Deal with Your Home,”, inheriting a collection of 80s Transformers action figures won’t have a big impact on your heirs, but a sizable asset like a house will.

Here are a few ways to help prepare now.

Should Your Aging Parent Live with You?

Published on: July 25, 2016 | By McCulloch & Miller, PLLC

Whether or not an aging parent should live with their adult children raises issues for the parent and the children. There is no single or easy answer.

It usually starts when one spouse dies and an aging parent suddenly seems alone and vulnerable. The parent may bring it up first, referencing a long ago conversation when the adult children said they would never put their parent into a nursing home or similar facility. As described in Forbes’ “Aging Parents and The Rise of the Multi-Generation Household,” this promise is usually made when the parents are well and the natural response “of course not” is an easy answer. But situations change, and the answer is not always so simple.

The Dickensian concept of “being put in a home” is based on largely outdated ideas of poorhouses and debtors’ prisons. While perhaps a bit drastic, it may not be that far off for Depression-era kids who saw the treatment of seniors before Medicare and Medicaid provided some care. Some nursing homes are still found to violate government regulations, but most are decent, well managed and comfortable places to care for seniors who need a lot of attention for a multitude of medical needs. Licensed board and care homes may be another option for long-term care, usually at a lower cost than nursing homes. They don’t offer skilled nursing, but they do have a more intimate environment with a less institutional atmosphere.

Executor 101: What You’ll Need to Know as an Executor

Published on: June 24, 2016 | By McCulloch & Miller, PLLC

A lot of details go into being an executor, and some people find it a thankless task. But knowing that you helped someone you love carry out his or her last wishes holds its own reward.

Most people are honored when they learn that they have been named executor of a loved one's estate. But according to an article in US News, "4 Tips to Be a Better Executor," they don't really understand what duties and responsibilities are involved.

An executor must deal with the estate of a deceased person—including identifying and valuing the assets, paying debts, and disbursing the assets according to the decedent's will. He or she also needs to ensure that the assets are protected during this period.

How to Make Your Houston Family Business the Exception That Survives

Published on: June 13, 2016 | By McCulloch & Miller, PLLC

Whether on the evening news or a serial drama, we love to watch the inner workings of family businesses—in large part because of the drama and the high likelihood of failure.

The narrative of family dynasties is intriguing. According to the Yakima Herald in "Passing the baton: 6 challenges for family business succession," that is because successfully transitioning from one generation to the next is extraordinarily challenging and statistically unlikely. The low levels of success are matched by high expectations of business owners who believe that somehow, someway, their family will continue to control the businesses. Their viewpoint is highly optimistic and—most often—wrong.

Whether it's a national chain of supermarkets or a mom and pop corner grocery, owners will face several obstacles when seeking to ensure that their business legacy continues with and through their children. Here are some common challenges to consider.

Different Generations, Different Values

Published on: May 11, 2016 | By McCulloch & Miller, PLLC

Houston Millennials have a different perspective about love, money and family.

Boomers have taught their children well. While nearly three quarters of boomers see a gift of money as an expression of love, according to a recent survey, their children don't see things the same way. These different values have a significant impact on how families should discuss and plan for inheritances.

Reuter's recent article, "Equating inheritance with love can cause discord," explains that Millennials hold very different views about receiving gifts. According to the survey, roughly 33% of them feel that a monetary gift is a way for the older generation to exert influence over them.

Planning Tips for Houston’s Single Parents

Published on: April 28, 2016 | By McCulloch & Miller, PLLC

Frankly, there is less room for error when a single parent is managing all of the responsibilities of raising a family. Five key planning guidelines are the focus of the Parent Herald's article "5 Financial Planning Tips For Single Parents For Your Family's Protection."

Here are the top five most important tips:

Create a safety net. Most important is to have sufficient emergency funds that can be your financial safety net. Single parents should save at least six months' worth of expenses in an account that's untouched until an emergency occurs.

Cost of Adoption Can be Offset with Tax Credits

Published on: November 20, 2015 | By McCulloch & Miller, PLLC

The average family can face high expenses when adopting a child. But there are tax benefits that will provide some help, as reported in The Middlesboro (KY) Daily News article, "Thinking of adopting? Be prepared for expenses." Among the benefits are an exclusion from your taxable income of employer-provided adoption assistance and a credit for qualified adoption expenses.

The maximum tax benefit you can claim for this year is $13,400, which is reduced if your modified adjusted gross income (MAGI) exceeds $201,010 and is completely phased out if your MAGI is $241,010 or more. The adoption tax credit is nonrefundable, so it's limited to your tax liability for the year.

For example, say that you pay $13,400 in qualified adoption expenses in 2015, and your employer reimburses you for $3,400. If you meet the MAGI guidelines, you can exclude $3,400 from your gross income for 2015 and can claim $10,000 ($13,400 minus $3,400) for the adoption tax credit.

529 Colleges Savings Plan – “Super-Fund” It!

Published on: January 10, 2014 | By McCulloch & Miller, PLLC

You can stuff a lot of money into a 529 college savings plan now and then do the same thing at the beginning of 2014 – a strategy that advisers say they are seeing many wealthy clients adopt this year.

Funding a 529 College Savings Plan before year-end is a great gifting strategy your college-bound grandkids. They will surely appreciate your gesture! And if you wanted to take that gift one step further, did you know you can actually super-fund it?

As though just funding a 529 were not good enough, Reuters provided the skinny on super-funding recently in an article titled “Should you super-fund your 529 college savings plan?”