Traditionally, many estate plans used wills and trust as the only instruments for an estate. The probate of a will or the actions of a trustee in distributing a trust satisfied the distribution of the material assets that remained after the death of a person. In the case of a will, the probate process was and is public in most situations.
]]> With the advent of social media, there are new questions to be addressed when considering creating an estate plan. With authorities noting that nearly 500,000 with Facebook accounts died in 2011, the questions often revolve around what to do with the online presence of a person after their death. In addition to Facebook accounts, the typical person in Nevada and elsewhere reportedly has 25 password-protected online accounts.A traditional will that goes through the probate process may be unable to keep up with the frequent changes to passwords and online accounts. In fact, the average person reportedly types up to eight passwords per day. To overcome this problem, officials recommend that a person devising an estate plan create a trust to deal with the online presence. The trustee could be directed to create a memorial page on Facebook or to close online accounts if that were the wishes of the deceased or to take what appropriate action is desired concerning one's Internet presence. The online life of a person is just another important consideration when creating an estate plan.
Source: The Atlantic, "The Government Would Like You to Write a 'Social Media Will'," Rebecca J. Rosen, May 3, 2012
]]>Some that are considering estate planning in Nevada also wish to address and honor their religious beliefs. These inclusions are often intended to dictate that a beneficiary be of a certain faith or act in a specific manner in order to receive an inheritance. But some authorities say that this estate planning decision can lead to costly and potentially divisive litigation in some cases.
]]> Some wills that include language restricting inheritances based on the faith of the heirs' spouses can lead to family discord. After the death of the person doing the estate planning, hard feelings can understandably emerge when one child is disinherited due to religious beliefs. Though courts have upheld such clauses in wills and other estate planning documents as long as they do not encourage divorce, such clauses can affect family relationships.When engaged in estate planning, it may do well for a person to consider all aspects of their spiritual and financial life. Some say the creation of a trust may be a better approach when considering the inclusion of religious restrictions. In that manner, discretion can be given to the trustee to resolve issues as they develop that both honor the intentions of the decedent and also strive to preserve peace in the family.
Source: Wall Street Journal, "Joining Church and Estate," Rachel Emma Zimmerman, April 30, 2012
]]>In some families the pet is an important member, as central to everyday life as anyone else in the household. In these cases, it may be beneficial for a person to create an estate planning document that relates to the care and maintenance of the pet after the owner's death. Using a trust or a will can assist those in Nevada who may wish to add Fido or Fifi to their estate planning efforts.
]]> In one recent case, an elderly woman passed away leaving her beloved 11-year-old cat. An animal lover throughout her life, the owner was concerned about the care of animals after her death. Due to this concern, she added language in her will, written about 20 years prior to her death, directing that any animal she owned at the time of her demise was to be euthanized.However, when she passed away, the trustee of her estate decided not to put the elderly cat to death despite the directive in the estate planning document. Going against the directive of the trust creator is fairly rare and generally requires the approval of a court. The trustee argued to the court that the elderly lady would have wanted to save the cat had she reconsidered the terms of the will. The trustee additionally pointed out the extent of care given to the cat and the long-time animal rights support by the now-deceased woman. In this case the trustee was able to persuade the court and the cat was spared and a small endowment was set aside for the cat.
When a person in Nevada begins estate planning, they would do well to consider all potential beneficiaries, human and not. This full consideration may assist in avoiding questions regarding the disposition of property after the death. It may be helpful to create charts or graphs detailing all assets as the process begins so as to ensure no one is left out and all are treated in the manner intended.
Source: Petside, "Saving a Senior Pet: The Story of Boots," Charlotte Reed, April 16, 2012
]]>Those who receive an inheritance from an estate would likely benefit by taking time to consider what they want to do with the money prior to making any decisions. Likewise, it may be best for many receiving an inheritance to consider paying off personal bills and investing before spending the money on other things. Understandably, planning can assist an heir in making the most of their inheritance.
]]> Those engaged in estate planning often seek ways to better control the spending of their beneficiaries, and many decide that establishing a trust is appropriate. Trusts are estate planning tools that can offer beneficiaries income, or even a delayed payout, while controlling the amount to be given at any one time. This may be a preferred choice for those with younger children or a beneficiary with special needs.For those who have inherited from an estate, a review of applicable tax laws may be in order so as to avoid decisions that may prove costly in the long run. Additionally, long term investment strategies may allow the beneficiary to maintain an income stream for several years or longer as a result of a large inheritance. Anyone who is considering planning an estate in Nevada may do well to consider both their own wishes for property distribution after death and the spending habits of their heirs as they create an estate plan that suits their purposes.
Source: USA Today, "How to get the most from an unexpected inheritance," Sandra Block, April 9, 2012
]]>Once an estate plan is established, a Las Vegas resident may largely forget about it and go on with their lives, thinking that they took care of all estate issues. However, authorities caution that it is important to review estate plans periodically in order to make sure that they continue to adequately reflect the person's wishes. This review is especially required when family situations change, including children, marriages, divorces and deaths.
]]> It is said that there are five key mistakes often made by those who have created an estate plan. These include failing to review documents, failure to adjust plans for changing family situations and ignoring the need to create appropriate trusts. Failure to update the schedule of assets or monitor changes in estate planning law are also considered potentially dangerous estate planning errors.When a person who has created an estate plan fails to include newly acquired assets into an already-established trust, there may be higher costs to heirs. This is due to the likelihood that probate may be required for the new asset. Additionally, changes to estate tax laws may occur, including the potential decrease in the estate tax exemption amount, and if the exemption is reduced as currently planned for the end of 2012, the effect may cost heirs significantly when a little forward thinking during estate planning may have solved the problem. All Las Vegas residents who have estate plans may do well to consider reviewing and updating them on a regular basis to ensure that they reflect current thinking and are in sync with existing laws.
Source: LifeHealthPro, "5 Important Steps to Update Estate Plans," Michael S. Fischer, April 9, 2012
]]>One necessary consideration is who is included in the estate planning equation. Are these people still an integral part of your life, or is an ex-husband or ex-wife still listed? Relationships change over the years, and as those connections change, estate planning goals may change as well. Someone that was listed in a will 10 years ago may no longer be of the same importance.
]]> Personal property typically accumulates with each passing year, including all those little pieces that have sentimental value. It is sometimes surprising at how many family members might fight over a cracked teapot that was "Granny's favorite." Because years have passed, you also know a lot more about the children that are included in a will or trust. You know more about their character and whether or not they can handle a large sum of money at once or if certain stipulations need to be included in estate planning documents that defers disbursement of funds until the individuals involved are married or reach a certain age.Your assets, as well as your outlook on life and the things that you want, are different now than they were 20 years ago. With that being said, Nevada residents would do well to focus on estate planning needs. By doing so and providing for periodic review of those decisions, they may ensure that their money and possessions go to the people they wish, even if those wishes change over time.
Source: Forbes, "Five Reasons Baby Boomers Need To Review Estate Plans (And It's Not About Taxes)," Deborah L. Jacobs, March 29, 2012
]]>First, there are two primary kinds of trusts: a living trust and a testamentary trust. As the names suggest, the former is funded during one's lifetime while the latter is created under a last will and testament. Yet whichever type of trust one creates, it's important to take the time to carefully appoint a trustee.
]]> The trustee is the person who manages the trust, and it can be anyone ranging from a spouse to a bank or other institution. But depending upon who is named as the trustee, the consequences can vary wildly. For example, if the trustee and the beneficiary of a testamentary trust are one in the same, then the IRS may include the assets in the gross estates of the beneficiary for the purposes of estate taxation. Likewise, a living trust that appoints oneself as trustee could have substantial tax consequences. It may thus be far better to appoint an independent trustee in many cases.Moreover, the trustee should be someone who is honest. The trust itself could last for decades and even across generations, so appointing someone who will diligently maintain the trust is important. The trustee should also ideally be someone with investment experience, and it may not always be advisable to choose a close family member due to familial conflicts. Of course, trust administration can become very complicated, and many Nevada residents may well consider seeking advice.
Source: Appleton Post Crescent, "Terrence Jack column: Pick estate trustee ahead of time," Terrence Jack, March 31, 2012
]]>Nevada residents engaging in estate planning may be interested to learn about a new study that shows that heirs spend nearly half of what they inherit in many cases. The study, conducted by Ohio State University for the US Bureau of Labor Statistics, shows that after they spend half, heirs often save, donate or give away the rest of an inheritance. This long-term study was conducted over many years.
]]> Those who are currently involved in estate planning who wish to limit the ability of an heir to spend large amounts of their inheritance might wish to consider a trust. A trust is an estate planning tool that often allows the trustee to distribute an estate under specific guidelines. Some types of trusts can even limit beneficiaries to only receiving money for their care and maintenance.Like all estate planning tools, both wills and trusts have benefits and potential disadvantages. There may be tax consequences and other considerations as planning moves forward. A person planning an estate would be well advised to review all of their assets and consider which beneficiaries they wish to leave their money to at the time of their death, while focusing on what will remain to be distributed after debts have been settled.
Source: Examiner, "OSU study finds most Americans save about half of inheritances," John Michael Spinelli, March 15, 2012
]]>Those who are trying to save money often end up unfortunately cutting corners. While the do-it-yourself wills may work for some people, in general, working with an estate planning professional will bring the best outcome.
]]> Some people who are looking to put together a quick and cheap will turn to the internet for answers. There are websites that, for a fee, will put together a will based on questions that you answer. Part of the worry that some people have about answering questions online is whether that information is safeguarded or will be used by the website. Another problem with online sites is that they often miss crucial components of a will, such as nominating guardians for your children or who will be appointed if the guardian passes away.Online wills also have a cookie-cutter disadvantage to them. For example, the will may set up a trust for your children that can be accessed after they turn 18. But what happens if you want them to be older before they can access the money or if that access should be based on very specific criteria, such as marriage or good grades? That's where a legal professional can make the difference.
Although couples who live under simple circumstances and have no children may get by with some forms of do-it-yourself wills, the majority of people would benefit from the expertise of a professional.
Source: Oregon Live, "Fill-in-the-blank wills can be a little skimpy," Brent Hunsberger, March 10, 2012
]]>Among the strategies recommended for consideration by wealthy people is the mega gift, according to reports. These are gifts made during a lifetime that can amount to $5 million under today's laws. Under the combined taxable estate and gift tax, it is not until this large amount is reached that a tax liability is triggered.
]]> The law is currently set to change at the end of this calendar year. Beginning in 2013, the combined tax is scheduled to be lowered to a new limit of $1 million. This potential change in the taxable estate amount could create a situation in which a beneficiary would have to pay taxes on what were previously nontaxable gifts.This complicated arena of estate planning can pose challenges to even the most sophisticated person. But careful consideration of gift strategies and trusts designed to limit the tax liability of a person's heirs may be just what the doctor ordered. These tools, when executed correctly, can be a great benefit to an estate and to those who stand to inherit.
Whether an estate is large or small, a Nevada resident would do well to determine the exact amount of assets intended for inclusion in an estate plan. After this preliminary research and documentation, a complete review of all planning tools may be helpful. In doing so, plans can be put in place that maximize the potential estate while limiting taxes and potential liabilities.
Source: Forbes, "Should Threat of Clawback Discourage 2012 Mega Gifts ?," Peter J. Reilly, March 13, 2012
]]>Don Barden gained much of his wealth after selling his interest in a Detroit-based cable television company to Comcast for $100 million in 1994. At the time of his passing, he was an owner of many large businesses. Among them were Majestic Star LLC, which owned the Las Vegas properties and other casinos in several states, and Waycor Development Company, which held commercial property. The Barden Companies had an estimated $310 million in revenue for the year 2010, according to reports.
]]> Like many people with substantial assets, Barden took steps through estate planning to make known his wishes for the distribution of his estate upon his death. Reports indicate that he set up a trust for his assets, called the Don H. Barden Trust, and at least one additional trust for the benefit of his daughter. A will was apparently created for this as a part of the estate plan, which has reportedly been filed in a Michigan probate court.A strong estate plan can assist a person in determining how their estate is distributed after death, while also addressing important tax and business considerations. In such a manner, assets that may be subject to taxes or other large expenses can often be protected. In the Barden matter, a trust was created with the possible intent of keeping much of the estate's assets out of the probate court. The trust is now being administered by trustees who have the duty to ensure that assets are protected for the benefit of the man's beneficiaries and in conjunction with the last wishes of Don Barden as detailed in the trust documents.
Source: Crain's Detroit Business, "Barden building sale brings estate closure closer," Sherri Welch, March 4, 2012
]]>Today, the land in question is used for 167 cottages, but the rent money for those cottages goes toward funding public schools in the area. Over the past 25 years, that has generated $2.4 million, which is no small sum. However, in 2006, tenants on the land filed a lawsuit over rent increases. That led to a settlement in which the trustees would convert the property into condominiums, and then sell those to the tenants.
]]> Originally, the trust was meant to help the town of Ipswich, Massachusetts, to comply with a colonial law that required them to set up a grammar school. Today, though, the rent from tenants on the land continues to help the town fund their public schools. If the cottages are converted to condominiums, then that would mean that ownership of the land would transfer and thereby destroy the trust. That has led to a bitter dispute in which one side claims that the trust is simply no longer able to carry out its purpose, and the other side is accusing the trustees of mismanagement.Trust administration disputes are hardly simple matters, and the length of this particular trust seems to be complicating matters further. Yet whatever the ultimate outcome of the dispute, the issue may well bear watching here in Nevada. Furthermore, it demonstrates that a properly formed trust can last long after one dies.
Source: New Jersey Herald, "351-year-old will sparks bitter dispute in Mass.," Rodrique Ngowi, Feb. 24, 2012
]]>According to a 2011 survey completed by the American Banker's Association, 57 percent of Americans age 55 and older prefer to do their banking online. This figure is up from just 20 percent a year earlier, illustrating how quickly Americans of all ages are turning to computers for many of their tasks. In addition to online bank accounts, many have email accounts, which may contain vital information. For self-employed individuals, these accounts may also hold details about their company and financial affairs.
]]> Yet online banking, email and other web-based services have passwords that prevent other people from accessing them. While this is a convenience while one is alive, it can be a burden to one's descendants. Moreover, as there are no paper documents to rely upon with regards to online accounts, the surviving family members may not even be aware of some assets owned by the deceased.For estate administration, the challenge of accessing online accounts can be a headache. Fortunately, many companies have polices that will allow a family member to gain access to a deceased user's account. In the event that the company does not, a court order from a Nevada or other state court may be necessary. Nonetheless, nothing beats taking the time during one's life to ensure that all their online accounts can be properly accessed after they pass away.
Source: Reuters, "Keep your digital life alive, after death," Marla Brill, Feb. 17, 2012
]]>In a recent ruling, the Nevada Supreme Court recognized a man's handwritten note as an expression of his desire for the distribution of his assets. A former Las Vegas police officer, the man had left a note written to his girlfriend in 1995 stating that he did not want his family to receive any inheritance at the time of his death. The note was written a number of years after a formal will that was executed by the man in 1975.
]]> The Nevada Supreme Court was asked to determine the validity of a handwritten notation in determining the proper distribution of the $3 million estate. The court decided that the note should take precedence over the executed will. The result was that the estate will now be turned over to the state and placed in its education coffers.The court noted it has no predisposition for estate funds to go to the state. However, it reiterated its intention to follow the last wishes of a decedent. In this case, the court found that wills which are signed and dated have the same legal effect as formal wills.
While the note written by the man indicated that his Las Vegas estate should go to his girlfriend, she predeceased him in 2002. Had the man executed a new document prior to his own death in 2008, he could have directed that his assets be distributed differently. As such, the case underscores the need to periodically review estate planning decisions in order to ensure that one's assets are handled in the manner they wish after their death.
Source: The Republic, "Nevada high court honors man's handwritten note cutting family out of will; $3M goes to state," Feb. 17, 2012
]]>This weekend close family and friends attended Houston's funeral, including her mother and 18-year-old daughter. As people remembered her top-selling hits, such as "I Will Always Love You" and "Didn't We Almost Have It All," a lot of attention has also been brought to the late star's financial situation and her estate.
]]> It appears Houston did not make any major investments and was not a song writer, which can often bring a lot of revenue from songs played on the radio. Although profits will likely continue to roll in from her album sales, most of Houston's music was written by others.According to a lawyer who worked with her on another matter, although he is not sure if she has a will, he says if she does not, the proceeds from her sales will go to her daughter. It is also unclear whether Houston had any debts before she died, but according to reports she lost two properties to foreclosure several years ago and was rumored to be asking friends for help financially in recent times.
Houston signed a $100 million recording deal in 2001 and planned to release a total of eight albums, including two compilations of greatest hits. She reportedly only released four of them before she died.
Source: The Washington Post, "Whitney Houston's death sparks outpouring that will benefit estate though questions remain," Feb. 14, 2012
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