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Pre Death Planning

Estate planning is for everyone. It is not just for “retired” people, although people do tend to think about it more as they get older. Unfortunately, we can’t successfully predict how long we will live, and illness and accidents happen to people of all ages. Estate planning is not just for “the wealthy”, either, although people who have built some wealth do often think more about how to preserve it. Good estate planning often means more to families with modest assets, because they can afford to lose the least.

Too many people don’t plan and they put off estate planning because they think they don’t own enough, they’re not old enough, they’re busy, think they have plenty of time, they’re confused and don’t know who can help them, or they just don’t want to think about it. Then, when something happens to them, their families have to pick up the pieces.

If you don’t have a plan, the State of California has one for you, but you probably won’t like it.

If You Become Disabled

Without proper planning, if your name is on the title of your assets and you can’t conduct business due to mental or physical incapacity, only a court appointee can sign for you. The court, not your family, will control how your assets are used to care for you through a conservatorship. It can become expensive and time consuming, it is open to the public, and it can be difficult to end even if you recover. If, instead, you appoint a person (or persons) of your choosing, in advance, to assist you, there is generally no need for expensive court procedures.The persons you would choose would be the Successor Trustees of your trust, and your agents under Durable Power of Attorney.

After Your Death

If you die without an intentional estate plan, your assets will be distributed according to the probate laws in your state. In many states, if you are married and have children, your spouse and children will each receive a share. That means your spouse could receive only a fraction of your estate, which may not be enough to live on. If you have minor children, the court will control their inheritance. If both parents die (i.e., in a car accident), the court will appoint a guardian without knowing whom you would have chosen.

Given the choice, and you do have a choice, wouldn’t you prefer these matters be handled privately by your family, and not by the courts? Wouldn’t you prefer to keep control of who receives what and when? And, if you have young children, wouldn’t you prefer to have a say in who will raise them if you can’t?

These are just some of the disability and immediate pre-death planning services (for the terminally ill) that McKenzie Legal and Financial can provide:

  • A review of all provisions of the Living Trust and other related documents to be sure they are properly up-to-date with the law and to be sure beneficiaries are properly provided for.
  • The transition of matters to the Successor Trustee now so he or she may assist you and your beneficiaries immediately.
  • The making of gifts or other planning to reduce the size of your estate, thereby reducing or eliminating federal estate taxes.
  • The installation of your “attorney in fact” appointed under your Durable Power of Attorney, where appropriate, so that he or she can attend to some immediate financial details.
  • Making sure all your assets are owned by the Trustee where appropriate and checking on beneficiary designations to certain assets such as IRAs.
  • Assisting you in obtaining Medi-Cal benefits to pay for nursing home expenses.

Post-Death Planning

These are some of the post-death planning and estate and trust administration services that we provide at McKenzie Legal & Financial:

Funding of Trusts

For certain estates, when one spouse of a married couple dies, there are many tax benefits to be derived from the funding of the “A-B” (Survivor’s and Exemption) and sometimes “C” (Marital) Trusts under the Living Trust. This work is of critical importance to your beneficiaries and loved ones to save countless Estate Tax and Income Tax dollars down the road. The funding of these trusts may also help further protect the surviving spouse from lawsuits or government claims and help assure that the beneficiaries of the first spouse to die will properly receive their intended inheritance when the surviving spouse dies. Sometimes, in lieu of or in addition to the “A-B” funding, we may use a Disclaimer Trust to shield certain assets from the estate tax, or a Federal Estate Tax Return may be filed to elect “portability” of any unused Estate Tax exemption of the deceased spouse.

Trust Termination Distributions to Beneficiaries Changing Titles

Quite often, it is a simple and inexpensive matter to properly terminate a Trust and make proper distribution of the Trust assets. Your Trustee will want to come in for a free initial consultation to determine, what, if anything, he or she will need our help with. Most importantly, real estate transfers should not be made to your beneficiaries without the assistance of a Law Firm, otherwise your Proposition 13 (low property tax base) status may be jeopardized. Your plan may also call for your beneficiaries to receive their inheritance through a Beneficiary Inheritance Trust, which will need to be established properly in order to maximize its intended asset protection benefits.

Probate Administration

We are experienced at assisting with Probate procedures when someone fails to do proper Living Trust planning or doesn’t keep it up to date. (Probate should not normally be necessary if you have a Living Trust fully funded with your assets.) We often can complete Probate within a year or less from the date of death.

Trust Modification or Reformation

Sometimes, changes may be necessary, appropriate or desirable to an irrevocable trust (including a Living Trust after the maker or first spouse dies). We may utilize a special agreement between the trustee and beneficiaries or court procedure to accomplish these important objectives. In addition, for those whose documents are drafted by our office, our current trust provisions allow for trust modification or changes WITHOUT spending thousands of dollars pursuing a court procedure.

Estate Planning for Beneficiaries

Once an inheritance is received, your beneficiaries will want to protect their assets from lifetime threats (divorce, lawsuits, creditors) as well as from testamentary problems (probate, estate taxes). We are here to assist your “next generation” of loved ones with their estate planning needs as well.

Please be advised that the information on this site is not meant to be construed as legal advice. If you need legal advice, or for more information about Pre and Post-Death Estate Planning, please contact our office at (562) 526-6941 for a FREE 30-minute consultation!

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