Asset Protection

RMDs for Retirement Accounts: What You Need to Know

Published on: December 16, 2016 | By McCulloch & Miller, PLLC

New Year’s Eve is the deadline for taking RMDs if you are older than 70 ½. Haven’t started yet? Get on this right away to get it done in time. Otherwise, be prepared to pay a penalty.

You still have a little time to beat the last minute rush on taking your Required Minimum Distributions (RMDs) from traditional IRAs and 401(k)s, according to Kiplinger’s “FAQs About Required Minimum Distributions for Retirement Accounts.” However, you had better hurry if you are older than 70 ½. You only have until December 31^st and any delays could be expensive. Remember that you aren’t the only one making this transaction at this time of year, and you’re hardly alone in waiting until the last minute.

Here is some additional information to help you meet your deadline for IRA withdrawals and some special rules for 401(k)s.

Senior Weddings Call for a Different Kind of Planning

Published on: December 14, 2016 | By McCulloch & Miller, PLLC

If you’re walking down the aisle again, there are a number of smart steps to take before you say “I do” another time.

Just as your life was probably simpler the first time you married, your subsequent marriage, especially if it occurs late in life, can become problematic, if good planning doesn’t happen in advance. If you don’t know your legal rights or your responsibilities, reports New Hampshire Magazine in “Navigating Late-Life Remarriage,” you, your children and your new spouse may be in for some unpleasant surprises.

While death and the likelihood that one spouse will outlive the other is inevitable, another important fact is that the divorce rate among those who remarry later in life years is 60%. This is much higher than the rate of any other segment of the population. Some experts think that number may go even higher.

Leave a Legacy of Peace for Your Family with Conversations and Estate Planning

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

When the greed nerve gets tapped, relationships suffer. There are things you can do now that will lessen the likelihood of family battles after you pass.

Every family has its own dynamics, and some siblings that never resolve their differences, no matter how many years go by. When both parents pass away, siblings either make peace with each other (and regret the lost years) or go at it even more intensely. Adding money to the mix can spell disaster and split families permanently.

Motley Fool’s article, “Avoid family fights over inheritance,” says you might be surprised at the amount of money that can cause arguments. It doesn’t have to be a fortune—deep-seated feelings of rivalry and jealously are, in many instances, at the root of the problem. With that in mind, let’s look at four ideas to consider in an attempt to avoid a battle royal over your assets:

For Entrepreneurs, Make a Succession Plan Part of Your Estate Plan

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

Estate planning for entrepreneurs is not complete until it includes a succession plan. Individuals who create successful businesses often find it hard to consider handing over the reins.

Entrepreneurs would not succeed without their ability to focus all of their energies on their business. It is not easy for this type of person to imagine that one day they may want to retire or that the possibility exists that they might become ill, injured or even die. Without an effective estate plan that includes a succession plan, their work, staff and families may be placed in jeopardy.

A recent business.com post, “5 Estate Planning Tips for Entrepreneurs,” lists these important estate planning essentials:

Will You Need a Will in Texas if the Estate Tax is Eliminated?

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

Regardless of which candidate becomes president and what changes are made in coming years, there will still be a need for estate planning in Texas, and that includes regular folks as well as the ultra-wealthy.

If the U.S. federal estate tax were to be eliminated, there will still be plenty for single family offices and estate planning attorneys to do, according to a Forbes article, “If the U.S. Federal Estate Tax Goes Away, What Will Single-Family Offices Likely Do?” Wills are still going to be needed to provide direction as to how assets are to be distributed, and all estate plans will likely need to be reviewed and revised in light of changes to the law. For the single family office, there will still be much to do.

Life insurance purchased to pay estate taxes will also need to be reviewed. One way to do this is to convert permanent policies with meaningful cash values into private placement life insurance policies (PPLI).

Don’t Bury Your Tax Returns, Use Them for Informed Financial Decisions

Published on: October 26, 2016 | By McCulloch & Miller, PLLC

Most Houstonians like to stash away our tax forms as soon as we file our taxes, but that’s a mistake.

When it comes to making financial decisions, you want to arm yourself with as much information as possible. One often overlooked source is your Form 1040, advises CNBC in “Use your tax return for more than paying taxes.” Sharing this document with your Houston estate planning attorney will allow them to get a clearer picture of your situation as well.

Lines 1-5 (Filing status). If you need to check a different box for your filing status, you should review your estate plan. If you get married or divorced, you'll need to update your will and the beneficiaries for life insurance and retirement plans.

How a Taxable Investment Account Can Be Good for Your Retirement

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

We’ve been so inundated with the idea of tax-free investment accounts that the taxable investment account’s role in retirement planning is underutilized and overlooked.

If you’re like most Americans, you’ve got at least one and maybe a few retirement accounts. You like the tax benefits that come from having IRA's, 401k's, 403b's, 457b's and defined benefit plans. You know you’ll have to pay income taxes when you start taking distributions from them, except for the Roth accounts, but seeing those accounts grow makes you feel good. And if you have a Roth, you like knowing that even if you aren’t getting a deduction now, distributions will be tax free. But there are other kinds of investment accounts for retirement planning.

As Physician’s Money Digest says in “10 Reasons You Need a Taxable Investment Account,” taxable retirement accounts are ignored because we’re so focused on IRS-approved retirement accounts. But you might think about supplementing your savings with a taxable retirement account. This can be a regular, old-school investment portfolio that’s not linked to any government regulations and that you’re building for retirement.

Fearing Loss of Control is One Reason People try to Hide Alzheimer’s

Published on: September 23, 2016 | By McCulloch & Miller, PLLC

Planning for life with Alzheimer’s includes selecting trusted family members or friends who can assist with legal and financial matters.

It was at least three years after his diagnosis that comedic actor Gene Wilder revealed he was suffering from Alzheimer’s disease. This is not unusual, according to experts discussing his situation in the Investment News article, “Hiding Alzheimer's, like Gene Wilder did, is natural, so prepare for it with all clients.” Wilder, star of Blazing Saddles, Willy Wonka and the Chocolate Factory and many other classic comedies, died at age 83 from complications of Alzheimer's disease. He wanted to leave his audiences laughing, rather than being sad that he was suffering from this dreaded disease.

Most Alzheimer's patients will hide their symptoms as long as they can because they fear losing control of their lives if family or friends are under the impression they can’t take care of things on their own.

When the Heir is Not A Family Member

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

A cautionary tale ends with a will being declared invalid, firings at the local police station and a lesson in elder abuse.

A wealthy 92 year old woman suffering from dementia left a $2 million estate to a local police sergeant but after three years of legal wrangling, her will was found to be invalid and the police officer and his supervisor were both fired from their positions. In New Hampshire Magazine’s September 2016 issue the article “Navigating Non-Relative Inheritance,” explains how vigilant professionals must be, especially in cases where children or other family members are being disinherited.

Just about all of the inheritances in a typical estate go to family members or to the deceased’s favorite charities. But when an unrelated individual is the beneficiary of a valuable asset or a large sum of money, it can raise questions and perhaps suspicions from those who felt they had a right to the inheritance. The issue may become how to balance the wishes of the testator—by distributing his or her assets as he or she sees fit—with the right of the bequeathed or the beneficiary of the will to accept it without creating a conflict of interest or violating the essential trust.

It Takes More than a Nest to Protect Your Retirement

Published on: September 2, 2016 | By McCulloch & Miller, PLLC

Having an emergency fund in place will help you deal with the unexpected. Surprising survey results point to this as a very weak link in many Americans’ financial plans.

Seniors who have finally reached retirement age after decades of work and smart planning may think they are all set once their nest egg is funded. But that nest egg needs to be protected by an emergency fund—something which most Americans seem to have forgotten during their retirement planning.

Fox Business’ recent article, “What Nest Egg? Two-Thirds of Americans Can't Cover $1,000 Emergency,” talks about the importance of maintaining an emergency fund so you don’t take withdrawals from your retirement accounts.