Asset Protection

Britney Spears Pets Live Large, but Without a Pet Trust, Their Luxe Life Is Vulnerable

Published on: May 25, 2017 | By McCulloch & Miller, PLLC

Britney Spears five dogs enjoy the same quality of life as she does, but without a pet trust, if anything happened to her, their lavish lifestyle would be at risk.

Pet trusts are no longer the exclusive province of the rich and famous, but a recent article in Trust Advisor reports that while Americans spend lavishly on our pets, they are still considered property and don’t have legal status or protection. According to “Britney Spears Pet Fetish Feeds New Estate Planning Craze,” whether you’re talking about protecting Britney’s pampered pooches or just an average American pet, you’ll need a pet trust to protect companion animals, if you become incapacitated or pass away.

While most of us want to ensure that our pets have loving care, rumors of the expense of Britney’s dogs gives us a view of some of the upper limits—or lack thereof—of how much modern pet pampering can cost. Britney spends about $30,000 a year on her dogs. This is enough to support over 100 typical American pets. One haircut for one of her dogs would feed an average animal for a year.

Retiring in 2017? Take These Steps Before You Make It Official

Published on: May 22, 2017 | By McCulloch & Miller, PLLC

Before you tell HR what your final day of work will be, there are more than a few details that you need to cover to prepare for taxes, make the most of any potential benefits and start retirement on the right foot.

If there’s a retirement season, it’s spring or early summer, when it feels like it did when the school year ended! But before you start planning your retirement party, Kiplinger advises you to take these steps first, as explained in article, “4 Actions to Take If You’re Retiring in 2017.”

Make sure to get the match. Your employer may “match” and/or offer “profit-sharing” contributions to your 401(k) or other retirement plan. You typically must be actively employed on the date of payment in order to receive these funds, so be sure that you understand the terms before setting your final work date.

You May Miss the Estate Tax, but Your State May Have Its Own Death Taxes

Published on: May 19, 2017 | By McCulloch & Miller, PLLC

Some states are cheaper to die in than others, that is, when it comes to death taxes.

The average American doesn’t have to worry too much about paying a federal estate tax, as the current federal estate tax exemption is a generous $5.49 million for 2017 and twice that if you are married. But that’s not the only death tax you and your heirs may encounter, depending on where you live or, more accurately, where you die.

MarketWatch’s article, “Here are the 20 most expensive places in America to die,” reminds us that about 20 states and DC have their own estate or inheritance taxes, or both. Some have exemption thresholds below the federal amount. Therefore, if you live in one of these states, you may be exempt from the federal estate tax, but still exposed to a significant state death tax bill.

Strong Trust Planning is Important When One Spouse is Not a U.S. Citizen

Published on: May 17, 2017 | By McCulloch & Miller, PLLC

With many tech companies, universities and businesses, North Carolina has become home to many resident aliens who contribute greatly to the state’s growth. Estate planning requires special knowledge of non-citizen tax rules.

More than $1 billion in annual foreign direct investment gives North Carolina’s private sector employment a huge boost, as reported in Trust Advisor’s recent article, “Foreign Spouses Need Strong Trust Planning.” That includes hundreds of thousands of workers, individuals who are not U.S. citizens but who establish residence here.

They’re known as “resident aliens” under U.S. tax law. There are also nonresident, non-U.S. citizens (“nonresident aliens”) who will invest in real and personal property situated in the state. This can include a wide variety of real and personal property, from vacation homes to ownership interests in a holding or operating company.

Minus Michael, the Jackson Estate is All Business

Published on: April 26, 2017 | By McCulloch & Miller, PLLC

Without the spending habits of Michael Jackson and the involvement of members of his inner circle, the Jackson estate has been transformed into an efficient multi-million dollar empire.

As it stands now, the only factors that might keep the Michael Jackson money machine from moon-walking into eternity are his heirs.

The estate recently severed ties to Jackson’s publicist and former management team, after a multi-year courtroom battle. The losers said they stood by the star at a really low point in his life. In return, they claimed, he promised them 15% of his business. Trust Advisor’s recent article, “Michael Jackson Estate Reveals Mr. Hyde Side: Dead Star Now Fighting His Friends,” explained that since the estate wanted all of the cash, whatever Michael really wanted is of little consequence without legal documentation. Since a judge has dismissed the claim, the estate can continue consolidating its hold over every aspect of the Michael Jackson brand. All the old relationships that he once had with partners and advisors are gone.

Can an Estate Plan Protect an Adult Child with an Addiction or Mental Illness?

Published on: April 5, 2017 | By McCulloch & Miller, PLLC

When all of your time is spent battling the challenges of mental illness or addiction, it’s hard to imagine what the future will bring. However, that’s exactly why estate planning is so important.

It’s not an easy issue to discuss with an estate planning attorney for the first time. However, if your children, minors or adults, suffer from mental illnesses or addiction to drugs, alcohol, gambling or any other form of addiction, the attorney will need to know so they can advise you properly. As described in Trust Advisor’s helpful article, “Hope For The Best, But Build Trusts For The Future Of Children With Special Challenges,” there are certain planning techniques that could be used in these situations.

Before diving in, estate planning requires a parent to acknowledge that an addicted son or daughter may never recover. With this in mind, estate planning must be done so that the child never has easy access to the funds. In this instance, a trust with special-purpose language may be a wise option.

Wrong Answers to Two Misconceptions about Estate Planning

Published on: April 3, 2017 | By McCulloch & Miller, PLLC

The moment you become a parent, you need a will. The same is true once you acquire any kind of asset that you want to give to someone after you die. It’s really that simple.

The reasons why so many people don’t think they need a will fall into a number of different categories. However, the two biggest ones are described in an article appearing in the Pauls Valley Daily Democrat titled “More on estate planning myths.” Chances are good you’ve heard them before, but you may not have heard why they are plain old wrong. Here’s why:

“I’m young, so I don’t need a will.” This is not true. One of the most important parts of a will for a young couple, is a provision that designates a guardian—the person(s) who will care for their young children in the event of their mutual death. This is rare, although it does happen. To make matters worse, what if there’s a family fight for custody of your children? Make this selection so the court isn’t forced to select a guardian for your minor children if the event arises. A will can give you peace of mind concerning the care of your children.

Four Decisions at the Heart of Retirement Planning

Published on: March 15, 2017 | By McCulloch & Miller, PLLC

Are you surprised that such a complex topic can be divided into just four sections? Once these difficult tasks are accomplished, you’ll have some much needed perspective that will help the rest of the process along.

According to a recent article in Forbes, “How Much Do You Need To Retire: 4 Things For Your Checklist,” these four decisions will help you clarify many questions about retirement and help more your planning forward:

Decide on your retirement age. This is easiest for many people, but the age you choose should align with your retirement savings and Social Security benefits. At a minimum, use Social Security payments as a baseline for your retirement income.

Before You File Your 2016 Taxes, Review These Tax Breaks for the Disabled

Published on: March 13, 2017 | By McCulloch & Miller, PLLC

There is some kindness in the tax code, especially when it comes to the disabled and their care givers. There are a few tax breaks that are intended to alleviate some of the financial burden.

Even when a disabled person is able to work, they or their caregivers must incur many additional costs, from transportation needs to medicines and special supplies for care. A study by the Centers for Disease Control and Prevention reported that one out of every five Americans lives with a disability. If this includes you or someone you care for, you’ll want to know about some tax tips that are designed to help. A recent article in Yahoo Finance, “8 Tax Tips for People With Disabilities (and Their Caregivers),” offers some useful details.

ABLE accounts. These accounts are newer savings vehicles for those who become blind or disabled before the age of 26. The accounts are like 529 college savings accounts—the account grows tax-free and can be spent on eligible expenses with no taxes. Contributions to these accounts don’t qualify for a federal tax credit or deduction. However, Iowa, Michigan, and Nebraska offer state tax benefits for contributing.

Savvy Tips for Dealing with an Inheritance

Published on: February 9, 2017 | By McCulloch & Miller, PLLC

Inheritances by their very nature, create many mixed emotions. While you are grateful for the inheritance, you are grieving, which is a painful experience that impacts decision-making skills.

Perhaps the most important thing to know when you are grieving the loss of a loved one and expect to receive an inheritance, is not to make any big decisions. While an inheritance may change your life in a financially good way, as reported in The Reading (PA) Eagle Business Weekly’s recent article, “What to do and what not to do with your inheritance,” you are in a state of emotional crisis. Financial planning and big financial decisions will need to be made, but nothing needs to be done immediately, except for settling the business of the estate, if you are the executor. Here are some dos and don’ts to keep in mind:

What not to do with an inheritance