Tag: estate plan

Celebrities Update Their Estate Plans Too

I’m sure everyone knows who Britney Spears is.  She is a famous pop star, has a Vegas Residency that rakes in millions of dollars?  Sound familiar??

Ms. Spears had an estate plan prepared for her a long time ago.  She probably has managers and attorneys who drafted legal docs before she ever got married or had kids.  It was recently in the news that she is making changes.  Her Will and other docs were written a while ago and now need a tune-up.  She has two boys, who will soon be teenagers.

Previously, Ms. Spear’s estate plan stated that when she passes her children would inherit everything.  That’s pretty standard in estate planning documents.

The issue with a Will or estate docs that were drafted a long time ago is that they can become outdated.  In the case of Ms. Spears her documents were drafted and didn’t include any distribution stipulations for a child’s inheritance, should she have any.  Now she has two sons, Sean and Jayden, who would inherit her entire fortune.  Ms. Spears net worth is around 200 million dollars.  Its not the wisest decision to open the vault to 18-year-olds all at once.

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Tips for Every Homeowner Part 2

This is the second half of our September 2019 newsletter that focuses on home ownership.  We have tips that every homeowner should know. If you are thinking of buying a home or already own a home these tips will help you navigate the costs and concerns of life’s biggest purchase.
  1. Consider a home warranty. If you didn’t negotiate one at closing, buy one. Many policies cover problems with appliances, heating or cooling systems and even interior plumbing.
  2. Do not expect a major tax refund. Many people believe they will get a significant tax refund the year they buy a house. This is not always the case. Especially if you purchase your home in the second half of the year, you will only have a partial year’s worth of deductions. You can write off property taxes and mortgage interest but not the mortgage principal payment.
  3. Maintain the exterior. Appearance matters, it helps maintain property values. Learn water rules. In many cities homeowners can be fined for watering their lawn on the wrong day. Ask sellers about landscapers. Find out who takes care of the yard, you may need to hire someone, or get the contact information for the current landscaper or gardener.
  4. Prepare for the worst. Make sure you are prepared for potential hazards such as earthquakes, hurricanes, floods or brush fire.
  5. Know your renewals. If your house has an annual termite inspection, or an alarm system contract, know when to renew. Most companies will not notify you of a renewal date.
  6. Think security. An alarm system may save money on insurance premiums.
  7. Take photos and/or a video of each room. You can use the video or photographs when making insurance claims.
  8. Finally, expect expenses to be more expensive than you thought. We can guarantee this one!

 

Tips for Every Homeowner Part 1

Our newsletter for September 2019 will focus on home ownership.  We have tips that every homeowner should know. If you are thinking of buying a home or already own a home these tips will help you navigate the costs and concerns of life’s biggest purchase.
  1. Get to know your home’s systems. When you buy your home, have someone, maybe the seller, introduce you to all the features.  You want to know how they work, you want a copy of the owner’s manual, and the name and phone number of a REPAIR PERSON. You want this information before something breaks on a weekend.  Be sure you know where to find the water shut off and the electrical box.
  2. Always have your locks RE-KEYED after you buy a house.
  3. Stay updated on schools in your district. If you have children and plan to send them to school instead of home schooling them, knowing the public and private schools in your area is important.
  4. Understand your homeowner’s insurance coverage. It might be a good idea to review it with your agent.
  5. Ask your home inspector these questions: what do I need to prepare and protect the home from nature’s elements (freezing weather, heat wave etc.)? How do I properly maintain drainage and moisture around the home to prevent foundation and mold issues? How often do you need to service the HVAC system to keep it functioning properly? Also ask, what items the inspector would repair or replace if he were buying the home?
  6. Familiarize yourself with neighborhood rules. Do you need approval from an HOA to paint your house a different color? Are there restrictions on fence heights? Any rules on vehicles, i.e. campers, RVs, boat trailers being parked at a property? Are there restrictions on pets, sizes and breeds?
  7. Do not touch your retirement savings. Do not put yourself in a situation where you have to dip into your retirement to buy, maintain or improve your house. Keep an emergency fund that covers 3-6 months of expenses to avoid feeling the need to dip into retirement savings.
  8. Review and reevaluate personal documents. Major life changes, such as buying a house or having a child, are good reasons to review your life insurance and estate planning documents. Trusts and Wills should be evaluated and if you don’t have one, it is a good time to see an Attorney about getting one.
Give our office a call with any questions. We are happy to help!  818.887.9401

Families are Evolving. Is Your Estate Plan?

Have you noticed that families are changing in this day and age? Traditional families are evolving and include more extended family and relatives. This newsletter talks about the changes of “traditional families” in our society and how they affect your estate plan. If you are interested in talking to an attorney, please give our office a call.

The laws relating to how estates are handled are designed with a very traditional nuclear family in mind – a husband, wife and biological children. That is not the traditional family anymore. Fewer than half of all U.S. households meet this traditional definition. That trend is likely to continue now that same sex marriage has been legalized nationwide. Also, divorce and remarriage remain very common. It is no longer about just the traditional versus non-traditional families.

A particularly serious issue to consider is the rapid advances in reproductive technology. How should children conceived with stored genetic material after the death of one or both genetic parents be treated in regards to inheritance?

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Bequeathing a Home to a Loved One

I am a 74 year-old retired woman living in a completely paid off condo. I hold title to my condo in my name only. I want to know more about leaving my leaving my condo to my partner and daughter when I die. I am asking about adding my partner of 20 years and my daughter to the home title in order to avoid probate. What is the easiest way to do that? Can I leave it in Joint Tenancy so the condo will pass both survivors (partner and daughter)? My parents had held title with both my brother and me and I want to know if there is a problem with this.

YES. There is a problem with this.   Here are a couple issues that could arise after you die. What if your daughter wants to sell this condo to raise cash, but your partner disagrees and doesn’t want to move. What if your daughter would like to collect rent and your partner refuses? What if your partner wants to remodel the home as she ages but your daughter wont share the costs? Would one survivor have to buy the other out? It also brings up questions of property transfer taxes.
The best solution is a revocable living trust! A trust can leave instructions (your wishes) for how to handle this situation. It may say that your partner can stay in the condo indefinitely but must pay a rent to the daughter. The trust can even establish what is a fair rent to pay. The trust could also say that the condo should be sold and the profit divided evenly.

Whatever you decide a revocable living trust can give the proper instructions on what to do. Both your partner and your daughter will understand these were your intentions and wishes. It may also prevent fighting and resentment and animosity between your partner and your daughter. With a Trust you also have less gift tax problems to deal with. The property will transfer to either survivor, depending on your instructions. You won’t face property tax reassessment. There are many issues that are never even thought of when it comes to bequeathing a property.
If you are interested in talking to an estate attorney to help you with bequeathing a home to loved ones please give our office a call 818.887.9401.

Should You Write Your Own Revocable Living Trust?

People have attempted to write their own documents, and we can honestly say every attorney we speak with agrees that writing your own Living Trust is a bad idea.

Here are four reasons why writing your own Revocable Living Trust is a BAD IDEA:

Estate Planning is not a one-size-fits-all or even most.

There are many books and online programs that can help with generating estate planning documents. But they are designed to cover only the most basic estate planning needs.   These generic forms are also deliberately kept as simple as simple as possible in order to comply with the law of all 50 state and D.C. Complying with the laws in Arkansas wont help a family who needs estate planning in Seattle. Estate planning is kind of like fingerprints, no one is a like, and using a generic software or book wont help your loved ones in the future.

Trust Laws Vary from State to State

Stat laws are all different when it comes to issues like probate, state estate tax, inheritance tax and even Trusts and wills.   There are so many different and specific issues it is best to speak with an attorney regarding your states laws. Probate in California is very different then probate in Michigan and can impact your loved ones after you pass. If you write estate planning docs yourself, they may not include provisions or topics that need to be addresses in your state. Here are some specific issues that can impact a Trust from state-to-state: definition of descendants, anti-lapse statutes, community property laws, homestead rights, common law marriages and many more. A generic trust cannot properly address all of these specific state law issues.

The Disclaimer

Books, software programs and online DIY websites all have the same type of disclaimer – “The information contained in the book/program/website is not legal advice and is not a substitute for legal advice. For legal advice, consult with an attorney.” We recommend just that, consult an Attorney!

You Get What You Pay for

Would you fix your own car? Repair your own computer? Perform your own surgery? I doubt it. While doing things yourself can save time and money in the short term, when it comes to estate planning, it’s the long term you need to worry about.

Here’s a brief story from an attorney who handled a Trust Administration for a family who did it themselves. A couple brought in their family’s trust. The elder couple had used a well-known attorney’s estate planning website to generate their own docs. When the family brought in the Trust, it stated on the first page that it was governed by Nevada law. I am a practicing attorney in Florida. What is the problem here? Nevada is a community property state and Florida is a separate property state. That was the first of many problems I faced.   It was very clear the couple didn’t understand what they were doing when they used the software. There were many contradictions in the Trust, which made administering it a long and expensive process due to the amount of time it took to try to understand what their intentions were.

Give Hornstein Law Offices a call to discuss estate planning and Trust administration. Doing it yourself will leave your family with a big mess if done incorrectly, and could potentially cost you and your family thousands of dollars. 818.887.9401.

Caring for an Ill or Elderly Parent

This month we are covering the subject of caring for our elderly parents.   Whether your elderly parent suffers from illness or if they are just getting older and need assistance, these steps will help you organize and care for them. This newsletter continues where we left off last time.   We discussed helping ill or elderly parents and loved ones. We ended our discussion after in-home care options. If you are interested in catching up on our newsletters they are all available on our blog. Now we will cover what are your choices when in-home care isn’t a viable option.

If the option to stay in their home is not viable for an elderly loved one you will need to start considering assisted living facilities.

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Musicians Who Died Without a Will

We have all heard the recent news that legendary artist Prince has passed away and he didn’t leave a Will. There has been much speculation about the battle between siblings over his estate and music royalties.

We wanted to talk about five musicians who passed away without Wills, like Prince, and what ended up happening in their battles.

Did you know Bob Marley and Tupac Shakur died without Wills? Bob Marley died after an 8-month battle with cancer, and he left no Will and nine children. Not to mention an estimated $30 million and royalties to all his music, and that was in 1981. Even with months to plan he did not make any attempt to set up an estate plan. As recently as 2012 there had been a lawsuit involving royalties of his music. And there may continue to be lawsuits in the future.

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When is it time to “Service” your Estate plan?

 One way to explain servicing your trust or estate plan is to compare it to your vehicle’s maintenance. We all know our cars require regular, preventative servicing in order to operate correctly and be reliable when we need them. The vehicle’s owner’s manual has a recommended schedule for service, based on either how many miles you drive or based on the amount of time that has passed. After a certain number of miles or certain amount of time your car will need an oil change, engine tune-up and tire rotation. Newer cars have “service due” lights that come on to alert you that it is time to service your vehicle. Either way, it is pretty easy to know when it is time to service your vehicle. If you continue driving your car without servicing it, it is almost guaranteed that your car will lose its reliability and not work when you need it. You could end up stuck on the side of the freeway.

Like a vehicle, your estate plan needs “servicing” if it is going to perform the way you want when you need it. These are preventative measures. Think of your estate plan as a composite snapshot of you, your family, your goals, your assets and the various laws in effect at the time it was created. All of these factors can change over time, and your plan should adapt to those changes. It is unreasonable, irresponsible and actually dangerous to assume your plan, written years ago, will be effective today without proper maintenance and adjusting.

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