Houston Estate Planning and Elder Law Attorney Blog

Making Smart Decisions About Your Pension

Published on: August 20, 2018 | By McCulloch & Miller, PLLC

The burden of saving for retirement shifted from employers to employees. It is now unusual for companies to offer pensions. If you’re lucky enough to have one, make your decisions wisely.

It’s hard to imagine today, but years ago, it wasn’t unusual to stay with one company for a lifetime, then retire and collect a generous company-provided pension that lasted as long as you lived.

Investopedia’s recent article, “Choosing How and When to Receive Pension Benefits,” reminds us that times have changed. Pensions have been replaced in large part by 401(k)s or other employer-sponsored savings plans. Those fortunate enough to still have a pension, will make it a large part of their retirement plan. If you have a pension, you’ll have to make some decisions, when you are ready to retire.

Why 529s Are Good for Everyone

Published on: August 17, 2018 | By McCulloch & Miller, PLLC

529 plans are a great way to help parents with taxes and college costs. Grandparents, aunts and uncles and anyone who wants to pitch in, can also benefit.

Starting to put aside money in a 529 college plan when children are very young, is a wonderful way to push yourself to save over an extended period of time, with some added benefits. Your kids get the advantage of having more funds to draw on for college, and you get an investment that grows tax free. It’s a good deal for everyone.

The Green Bay Press Gazette’s recent article, “Benefits of 529 college savings plans keep giving,” reports that the state of Wisconsin’s 529 plan is called the Edvest College Savings Plan.

What are the Taxes When Inheriting an Out of State Vacation Home?

Published on: August 15, 2018 | By McCulloch & Miller, PLLC

When the family vacation home is passed from one generation to the next, there are certain tax issues to be aware of, particularly the step-up in basis. However, there may also be state taxes.

The first part of understanding the tax responsibility when you plan on giving it to your family vacation home to adult children who live out of state, is to understand the definition of “basis” and “step-up in basis.” These terms refer to income taxes and are used to determine any gains or losses on the sale of the property.

When you die, property that you own or control is valued as of the date of death. The children who inherit the property take it with that value as their basis. The first thing is to determine the parent’s basis in the property. You should then look at how the basis of inherited property is handled. Generally, the basis of property inherited from a decedent is one of the following:

Choose Executor, Agent and Trustees Carefully

Published on: August 13, 2018 | By McCulloch & Miller, PLLC

Selecting the individuals who will make important decisions on your behalf, when you are incapacitated or have passed away, is not to be done lightly.

Is there a bomb ticking quietly in your estate plan? The chances are good that there is, says Forbes in “Defusing The Time Bombs In Your Estate Plan.” The only question is, how big will that explosion be? The “bombs” are the people, or the individual, who you name to act on your behalf.

Whether they act during your lifetime or after you pass away, these individuals frequently can make or break your estate plan. They can determine the fates of family relationships and financial security. However, most people don’t realize the potential consequences of their surrogates’ actions. As a result, they don’t give sufficient thought to whom they appoint to these important roles.

Buzz Aldrin’s Capacity Case Illustrates Need to Plan for Aging Issues

Published on: August 10, 2018 | By McCulloch & Miller, PLLC

Even when planning for competency issues is in place, there can still be problems. When a highly-intelligent public figure makes decisions his kids thinks are wrong, who is right?

The case of Buzz Aldrin, who is taking his son and daughter to court on charges of fraud, conspiracy and exploitation of the elderly, is a tough one. He’s accusing his adult children and his longtime manager of slandering him, by telling others he has dementia and Alzheimer’s diseases, using his money for their own gain and undermining romantic relationships.

The 88-year-old astronaut’s lawsuit illustrates the reason it's important for families to plan ahead for an aging parent. However, cases like Aldrin's can be hard, because it can be difficult to determine when someone has a deteriorating mental capacity, explains Good 4 Utah in the recent article, “Buzz Aldrin lawsuit shows need to plan for aging parents.”

Here’s Where NOT to Retire

Published on: August 7, 2018 | By McCulloch & Miller, PLLC

If taxes and cost of living are important factors for you, here’s a look at states where you should only retire with a good reason, like family ties.

You’ve read plenty of surveys about the best places to retire, but have you ever looked at the worst ones? Think Advisor took a new twist on a new survey by Bankrate.com, in its article “12 Worst States for Retirement: 2018.”

The least desirable states for retirement typically had poor ratings in the categories for cost of living and taxes and were also weighed down by low scores in other categories. Bankrate.com created its rankings by looking at seven categories of interest to retirees and weighted those rankings based on the importance given to them by respondents to the firm’s 2017 survey. The categories were:

The Unexpected Threat to Estate Planning

Published on: July 19, 2018 | By McCulloch & Miller, PLLC

Neglecting to plan for family dynamics can destroy the best estate plans. Make sure to address both difficult personalities and tax liabilities. They can be equally problematic.

Saving loved ones from a large tax bill and maximizing the transfer of wealth across generations is great, but your estate plan needs to do more than that. The plan must consider the dynamics of your family, how they may treat each other after you pass and what can be done to protect them from each other.

CNBC’s recent article, “This threat could devour thousands of dollars from your estate,” notes that even families that look like they're perfect, are not. Perfection doesn't exist. When families fail to address these types of issues in their estate plans, it can create conflict between beneficiaries.

Teach Your Children Early About Retirement Planning

Published on: July 17, 2018 | By McCulloch & Miller, PLLC

Most young adults are not thinking about retirement when they get their first jobs, but starting early, even if on a very small scale, can make a big difference.

When you are working to pay off student loans and trying to save enough to get a place of your own, retirement takes a backseat, says The Milwaukee Community Journal, “How parents can help their kids with retirement.” About 66% of millennials haven’t set aside any money for retirement, according to a report from the National Institute on Retirement Security. However, parents can counsel their young adult children on how and why to start a retirement plan now, before it gets to be an issue. Many workers early in their careers think retirement isn’t worth considering because it’s so far off, and they have other obligations. But getting a late start is a big mistake, because they’re missing out on years of compounding returns.

Here are five tips parents can give their young adult children to help them to begin planning for retirement:

How Singles Can Address Estate, Financial and Emergency Planning

Published on: July 16, 2018 | By McCulloch & Miller, PLLC

Not having a spouse makes it more important for singles to plan to protect themselves from a legal and financial standpoint.

Everyone should have a plan in place for incapacity, affirms fox5atlanta.com in a recent article, “Estate, emergency planning for single people.” This is especially true for singles. While married couples can usually rely on each other, or their adult children, in case of emergency, what happens to singles who don’t have family members? You need a backup plan and a backup person.

In many instances, singles don’t have a backup plan. If you are young and single, then you typically aren’t thinking about a worst-case scenario at all.

A Partial Checklist for Your Will

Published on: July 13, 2018 | By McCulloch & Miller, PLLC

Having a will prepared is a gift of kindness to your loved ones. They will appreciate the effort to care for them, after you’ve passed on.

If you need another reason to have a will prepared, consider the potential for conflict among loved ones who will have to guess about what your wishes were during a very difficult time. You can spare them that distress, by preparing your will and estate plan in advance.

US News & World Report’s article, “10 Steps to Writing a Will,” says that if you've been procrastinating on completing the task, here's your opportunity to cross it off your list. You can get going with these simple steps.