Articles Tagged with Trusts and Estates

10.18.17For living trusts, the person or people who set them up are usually named the initial trustees, but after that, there needs to be a successor trustee. Think carefully about who you would want to take on these responsibilities.

When the first spouse dies, the surviving spouse usually becomes the sole trustee, according to the article, “Women on Money and Mindset: Estate planning: choosing a trustee,” in The (Riverside CA) Press-Enterprise. When the second spouse dies, the trust passes to a successor trustee or trustees. Most people name an adult child, trusted friend or a family member who they trust. You can also name a bank or a professional fiduciary.

Children: Married couples often will name their oldest child as the successor trustee or they name all their children to act as co-trustees. This can work if there’s never been a divorce; there is only one child; she lives close; she doesn’t work and all the assets are investment accounts.  However, most adult children will have full-time jobs. Adding the job of trustee can be a strain because it’s time-consuming and technical. The administrative burden of taking care of your final business can be overwhelming.

5.17.17With 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.

6.17.16We never know what's around the corner. Big changes come in all different types. Best strategy: be prepared and deal with whatever comes.

Of those Americans who actually have a will and an estate plan in place, there's still a tendency to let years go by before they update their wills and finances. Any good Houston estate attorney will tell you that a will needs to be updated every three or four years to take advantages of any changes in the law and to address any life changes that occur.

The Middletown Transcript warns in "Game-changing life transitions that need attention" that sudden transitions need to be addressed immediately. However, many times these events will have more complex consequences impacting other parts of your life. Don't stick your head in the sand when such an issue comes up. Deal with it in the context of your overall life.

5.20.16Despite countless celebrity estate battles, most Americans still put off having a will created. Think of a will as an itinerary for your family that will make their lives easier once you are gone.

Prince was clearly busy with performing, writing, recording and creating. But that's still not a good reason for him to not have put a will in place. The very public court processes that are now underway could have been completely avoided had he devoted the time to creating an estate plan.

The Huffington Post, in its May 3 article, "Like Prince, A Majority Of Americans Don't Have A Will," stressed that wills are important as they establish beneficiaries, distinguish who gets what (and how much of it), and prevent the state from deciding what happens to your property.

5.9.2016Many young couples choose to hold off on estate planning because they feel they are too young to worry about estate planning and death. Maybe it’s because they think they don’t have enough assets to begin an estate plan or they just don’t want to think about death and what may happen to their minor children. However, having minor children is reason enough to being the estate planning process. And being young and healthy is not a “get out of jail free” card when it comes to death, as Houston accidents happen all the time.

If you have minor children, you should consider initiating the estate planning process immediately. While it’s not the easiest topic to discuss, it’s one of the most important things you can do for your family. The estate planning process is not too difficult, and it helps to be prepared before you start. The process is much easier when you know what is expected of you:

  • Name a trusted individual to be the executor of your estate.

B&w couple pic 5.5.2016People think that Medicaid will solve all financial problems if they or a spouse will need expensive medical care late in life. It's not that simple.

Concerns about outliving assets or having all their wealth spent on nursing home care has led many Houstonians in different economic brackets to take steps to qualify for Medicaid as part of their estate planning. But Medicaid was not designed to be the first source for health care costs.

Remember that your income and assets have to be at a very low level to qualify for Medicaid. This program isn't a right or an entitlement—even if your tax dollars paid for it. Medicaid provides assistance for ongoing living needs and services provided by home care or, in advanced cases, at a nursing facility.

Top secret keyToday’s millennials understand that their digital assets, which include everything from family movies hosted in the cloud, to social media accounts, digital currencies like Bitcoin and domain names, have value that can be passed to others when they die. One young man created a will that listed all of his digital assets and used a password manager to gather all passwords in a central location. He gave the password manager to his brother, who is his estate executor. He also moved certain digital assets, particularly photos and movies, to a file sharing service so that other family members would have access to them in the event of his demise.

Many people neglect to include digital effects in their estate plans, which can be a huge mistake, as valuable assets may go unnoticed, or money and time might be spent attempting to find them.

There are some assets like digital currencies, video game characters, and Internet domain names that exist only in cyberspace. You can’t put these in a safety deposit box: they can be overlooked because they aren’t as tangible. These days, folks are acquiring more digital assets like Facebook photos or email addresses all the time. However, getting access to social media accounts can be difficult because laws governing digital assets vary by state. Online sites concerned with user privacy have drastically different terms and conditions that sometimes exclude executors.

Hour glassThe irrevocable charitable lead trust is a trust that cannot be amended, revised or cancelled. We would call that bullet-proof, and it would have been a good idea for preventing James Gandolfini's estate from being "whacked" by estate taxes. The financial website took a closer look at this powerful estate planning tool in"How to Protect Your Estate From Getting 'Whacked' Like James Gandolfini's.

This trustprovides a stream of income for a designated number of years to the specified charity. At the end of that period, the property held in trust reverts back to the donor or to the donor's designated beneficiary.

When the donor makes the gift under a charitable lead trust, he or she immediately receives a federal income tax deduction equal to the present value of the future income stream. But the donor is taxed every year on the value of the income interest that is payable to the charity.

ThanksgivingLong-standing American family traditions are changing with the times.  The sled trips through snowy woods and icy rivers have given way to cross-country jet flights and international Skype visits. But regardless of the changes, when you all do sit down to a holiday meal, according to's "Estate Planning Over Thanksgiving? Time to Talk Turkey," this is a perfect time to start talking about important family matters, including estate planning.

If families or cultures are averse to raising such topics around the holidays, there should be an annual meeting to let family members know where an estate plan stands.

When combing through assets, remember that no item is too small for discussion, especially during the holidays. It is a natural time for emotions to run high, but it is a great time to discuss items of seemingly insignificant value that may take on added significance for each potential heir.

Money with watchIf you inherit a portfolio or a large amount of money, proceed with caution, according to "What to Do When You Get an Inheritance," in US News & World Report. Every situation is different, but a few basics need to be kept in mind for heirs who are thinking about investing their inheritance in stocks, bonds, hedge funds or any other investment vehicles.

First, get good information and consider assistance from an expert: speak with an experienced estate planning attorney, one who worked with those giving the inheritance. Heirs should find a CERTIFIED FINANCIAL PLANNER™ practitioner who works for a registered investment advisor with a fiduciary duty to their clients. They aren't commissioned salespeople.

If the inheritance involves a larger sum, it can be administered via a trust that needs to be funded properly due to tax ramifications and expenses.

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