Ask our Team

Estate Planning | Probate | Conservatorship & Guardianship | Elder Law

 
Estate Planning

What is an Estate Plan?

An estate plan addresses not only the transfer of wealth at death, but also important end-of-life decisions, and guardians for minor children. A well-written estate plan can also provide tax savings. The following documents should be included in a comprehensive estate plan:

  • Trust
  • Pour-Over Will
  • Durable Powers of Attorney for Property Management
  • Advance Health Care Directives.

Who Needs an Estate Plan?

Everyone needs some kind of estate plan. Most often, a Trust-centered estate plan is most appropriate. However, in certain situations, a Will-centered estate plan may be sufficient. It is important to have a well thought-out estate plan regardless of your worth as estate plans address so much more than simply the distribution of your assets. A well-crafted estate plan ensures not only the distribution of your assets at death, but also the care you receive in the event you become unable to care for yourself.

What is a Trust?

A Trust is a legal arrangement in which a Trustee holds legal title to property for a beneficiary. You can be the Trustee of your Trust, which allows you to keep full control of your assets. There are three main "players" in a Trust:

The Settlor: the person who creates the trust (also referred to as Grantor or Trustor);

The Trustee: the person who manages the Trust; and

The Beneficiary: the person who benefits from the Trust.

The Settlor is typically the only person who can make changes to the Trust document. In a conventional living (or intervivos) Trust, the Settlor, Beneficiary, and Trustee are initially the same person. It is only when the Settlor becomes unable to handle his or her own financial affairs that a successor trustee (chosen by the Settlor) takes over the management of the Trust. The Trust assets are to be used first and foremost for the benefit of the Settlor, with the remainder beneficiaries receiving an interest in the Trust only after the Settlor's death (the same way that a person's estate passes to his or her beneficiaries under a Will).

Does the Settlor lose control of his or her assets if they are transferred to the Trust?

No. Although the Trust is the legal owner of the assets, the Settlor does not lose control over those assets. The Settlor controls the Trust and thereby retains control of the assets owned by the Trust. There is no reassessment of property taxes when real property is transferred into a living trust, and federal and estate income taxes are still filed under the Settlor's social security number as an individual.

When does an estate become taxable?

The Estate Tax laws are currently in a state of flux. The federal estate tax exemption amount (the size of a person's estate that may pass to beneficiaries free of estate tax) is slowly rising until 2010, when it disappears, only to return in 2011 as follows:

Year

Exemption Amount

2005

$1,500,000

2006

$2,000,000

2009

$3,500,000

2010

Estate Tax Repealed - No Estate Taxes

2011

$1,000,000

Many professionals believe changes will be made to the existing Estate Tax laws before 2010, but no one is certain what those changes will be. Because of this, it is important to remain in contact with your estate planning attorney to ensure that your estate plan maximizes the tax savings available at the time.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, you are hereby informed that any US tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax related penalties under the Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein. You should seek advice based on your particular circumstances from an independent tax advisor.

Back to Top

Probate

What is Probate?

Probate is the legal process in which a decedent's assets are distributed under court supervision. If the decedent had a valid Will, the assets are distributed according to the terms of that Will. If the decedent had no Will (died intestate), the California Probate code dictates how the assets are distributed at the end of the probate administration.

Does a Will avoid probate?

A Will does not avoid probate. California law states any estate with a value of over $100,000 must be probated.

How does a Trust avoid Probate?

When a Trust is created, essentially all of the Settlor's assets are transferred to the Trust and the Trust becomes the legal owner of those assets. When the Settlor passes away, he or she does so holding title to little or no assets in his or her name. Because the decedent's estate is less than $100,000, no probate is triggered. (See Estate Planning information.)

Back to Top

Conservatorship & Guardianship

What is a Conservatorship?

A Conservatorship is a protective court proceeding in which a fiduciary is appointed by the court to oversee the financial affairs or personal care of an individual who cannot provide for his own financial or personal needs.

The main "players" in a Conservatorship are as follows:

The Conservatee: the person who is cared for or whose property is managed by someone appointed by the court; and

The Conservator: the court-appointed fiduciary responsible for the protection of the Conservatee's person and/or property.

Conservatorships are costly as the Conservator must report to the court on a yearly or bi-yearly basis until the Conservatee dies or regains capacity. A valid Durable Power of Attorney for Property Management and a valid Advance Health Care Directive may avoid the necessity of a Conservatorship in many instances.

What is a Guardianship?

A Guardianship is a court proceeding in which a Guardian is appointed by the probate court to protect the person or estate of a minor. Guardianships of the person are often established by relatives or other caring adults to provide stability and needed care for minors whose parents fail to provide for them. Guardianships of the estate are commonly sought when a minor inherits significant assets or when proceeds from litigation are expected and merely placing the assets in a blocked bank account until the child's 18th birthday is undesirable

Back to Top

Elder Law

What is an Elder Law Attorney?

Elder law attorneys are holistic lawyers, dealing with the legal and non-legal problems of their clients by using a multi-disciplinary approach. Geriatric care managers, guardians, social workers and other aging network professionals play an important role in this approach. Our goal is to address the broad range of needs in a holistic fashion so that the social, psychological, medical and financial needs are met, not just the legal needs.

Elder law attorneys bring to their practice knowledge of the elderly that allows them and their staff to ignore the myths relating to aging and the competence of the elderly. At the same time, they will take into account and empathize with some of the true physical and mental difficulties that often accompany the aging process. Their understanding of the afflictions of the aged allows them to determine more easily the difference between the physical versus the mental disability of a client. Elder law attorneys are more aware of real life problems, health and otherwise, that tend to crop up as persons age. They are tied into a formal or informal system of social workers, psychologists and other elder care professionals who may be of assistance to you. All of these things will hopefully make the client more comfortable when dealing with the attorney, easing the client's way as he or she tries to resolve his or her legal problem.

What is specific about the legal needs of the elderly?

Legal problems that affect the elderly are growing in number and the laws and regulations are becoming more complex. Actions taken by older people with regard to a single matter may have unintended legal effects. In order to avoid future problems, it is important to work with an attorney who has a broad understanding of the laws that may have an impact on a given situation.

Back to Top


DISCLAIMER: The information provided at this website is published as a service for informational purposes only. It is not intended to be used as legal advice. It is not intended to, nor does it create, an attorney-client relationship and no attorney-client relationship is formed unless agreed to in writing. You should not take (or refrain from taking) any action based on the information you obtain from this website without first obtaining professional counsel. In the event this communication is not in conformity with the regulations of any state, we are not willing to accept representation based on this communication.