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You need to have at least these three basics: a will or trust, a power of attorney, and a medical directive.
Estate Planning Attorneys Dedicated to Rocklin
You might think that you don’t have an estate plan yet—so you might be surprised to hear that California has one for you. In the absence of legal planning, your estate will be distributed after death according to state intestacy laws.
If you want to control your assets, beneficiaries and end-of-life care, a proper estate plan is a must.
Your last will and testament is just one part of a comprehensive estate plan. If you die without a will, you are considered to have died “intestate.” State laws will determine how and to whom the person’s assets will be distributed. Some things you should know about wills:
Trusts come in many varieties. They can be simple or complex, and serve myriad legal, personal, investment or tax planning purposes. At the most basic level, a trust is a legal entity with at least three parties involved: the trust-maker (you), the trustee (trust manager), and the trust beneficiary. Often, all three parties are represented by one person or a married couple.
In the case of a revocable living trust, for example, you may create a trust (the trust-maker) and name yourself the current trustee (trust manager) who manage the trust assets for your own benefit (trust beneficiary).
Depending on the situation, there may be many advantages to establishing a trust, including avoiding probate court. In most cases, assets owned in a revocable living trust will pass to the trust beneficiaries (or heirs) immediately upon the death of the trust-maker(s) with no probate required. Certain trusts also may result in tax advantages both for you and your beneficiaries. They may be used to protect property from creditors, or simply to provide for someone else to manage and invest property for your and your named beneficiaries. If well drafted, another advantage of trusts is their continuing effectiveness, even if you pass away or become incapacitated.
A power of attorney is a legal document giving another person (the attorney-in-fact) the legal right (powers) to do certain things for you. What those powers are depends on the terms of the document.
A power of attorney may be very broad or very limited and specific. All powers of attorney terminate upon the death of the maker. They may terminate when you (the principal) become incapacitated (unable to make or communicate decisions).
When the intent is to designate a back-up decision-maker in the event of your incapacity, a durable power of attorney should be used. Durable Powers of Attorney should be frequently updated because banks and other financial institutions may hesitate to honor a power of attorney that is more than a year old.
An advance directive is a document that specifies the type of medical and personal care you would want, should you lose the ability to make and communicate your own decisions. Anyone over the age of 18 may execute an advance directive, which is legally binding in CA.
Your advance directive can specify who will make and communicate decisions for you. It can also set out the circumstances under which you would not like your life to be prolonged—for example, if you were in a coma with no reasonable chance of recovery.
A document that goes hand-in-hand with your advance directive is an authorization to your medical providers, to allow specified individuals to access your medical information. Without this authorization, your doctor may refuse to communicate with your hand-picked decision maker.
Asset Protection for Rocklin & Roseville Business Owners
Asset protection planning involves making prudent decisions today to protect yourself, your business, and your hard-earned assets from loss due to lawsuits, creditors or bankruptcies. If you’re a professional or business owner, your personal assets could be at risk due to the nature of your employment.
Statistically and anecdotally, we all know that the number of divorces, lawsuits, and bankruptcies is staggering. While no one believes lightning will strike them, wealth created through a lifetime of work, saving and investing can be lost overnight if these forms of man-made lightning do strike. To protect your assets from such disaster, give proper risk management strategies careful consideration. These strategies include exempting your assets from the claims of creditors, limiting your liability through legal entities, and transferring your risk through insurance.
State and federal laws exempt some of your assets from the claims of creditors. It’s important you remember that while some states allow you to choose either the state or federal exemptions, in others you must use the state exemptions … and federal bankruptcy exemptions are not available.
Once you have identified the protected asset classes available to you under applicable law, it may be prudent to maximize your protection by converting non-exempt assets into exempt assets.
Many entrepreneurs operate their businesses as sole proprietors rather than through a legal entity, such as a Corporation or a Limited Liability Company. Whether your business is home-based or in the Fortune 500, you might appreciate the informality of sole proprietorship. Perhaps you don’t want to incur legal fees to create and maintain a legal entity. However, in addition to other advantages, conducting business through a legal entity may offer substantial risk management benefits.
Imagine someone brings a lawsuit against your business. While lawsuits brought against a sole proprietorship are really lawsuits against your (the owner’s) personal assets, lawsuits against a properly created and maintained legal entity are lawsuits against the entity’s assets. The selection of an appropriate legal entity is critical for managing your risk.
When was the last time you reviewed the details of your liability insurance program with your insurance professionals? Are your policies current? Are the coverage limits adequate and are the deductibles reasonable? Have you scrutinized the policies for loopholes? Remember: the fundamental philosophy of any insurance coverage is to pay a premium you can afford, to transfer a risk you cannot afford. Take time to understand both the risks you have retained and the risks you have transferred.
Business Succession Planning in Rocklin
If you own a small business, you’re part of the backbone of the American economy. Some 90 percent of all businesses in this country are either family-owned or family-controlled. They come in all shapes, sizes and colors, representing all sectors of our economy. From agriculture to services, technology and manufacturing, family businesses generate an estimated one-half of the U.S. Gross National Product and pay half of all wages earned in this country.
Not all family businesses are traditional small businesses, either. In fact, roughly one-third of all businesses included in the Fortune 500 are family businesses. But not all family business statistics are rosy.
Owning a small business means you need to think about succession. Family businesses tend not to outlive their founders. At any given moment, 40 percent of family businesses are in the process of transferring their ownership. Unfortunately, two-thirds of all initial transfers fail. Of the one-third that survives an initial transfer, only one-half will survive a second transfer. It is estimated that by 2040 about $10.4 trillion in family business owner net worth will be transferred. How can you ensure your small business’s success, after you pass on?
The reasons for this dismal success rate are as varied and unique as the businesses and business owners themselves. Nevertheless, many of the failed transfers can be traced to three causes: people, taxes and cash.
The family element in every family business can mean the difference between its success or failure during the transfer process. The retirement, disability or death of the business owner are all common events that can trigger a business transfer.
Tough questions must be asked and answered. Otherwise, the business that took you decades to build can be destroyed overnight.
For example, who will run the business after you? Will it be your spouse, one of your children or a non-family member key employee? If your spouse will not run the business, will he or she still be financially dependent on it…or can you make arrangements to ensure they are financially independent of it?
What arrangements have you made for the inheritance of your children who are not active in the business? Have you in-law-proofed your estate?
Thinking ahead to the second-generation transfer of your business, what provisions have you made to encourage thrift and industry among your grandchildren?
The only certainty about the federal estate tax is its uncertainty with each change in Congress and the White House. Some states now impose their own estate taxes, independent of any federal estate taxes. It’s important that you’re aware of these changes, and plan accordingly.
Why? Without proper estate-liquidity planning, your family may have to sell the business just to meet an estate tax cash call. Your estate planning lawyers at Goff Legal, PC can monitor the changing economic, political and legal climate to protect your business.
If your financial and estate plans are not carefully coordinated, there may not be enough cash to fund your objectives. An appropriately funded estate plan can meet all of your people-planning objectives and provide liquidity for estate taxes (and business debts). Life insurance, owned in the proper amount, type and manner, may be effectively used to fund such money matters.
You may decide that a business Buy-Sell Agreement (BSA) is right for your company. A BSA is a lifetime contract providing for the transfer of a business interest upon the occurrence of one or more triggering events, as defined in the contract itself. For example, common triggering events include the retirement, disability or death of the business owner.
An interest in any form of business entity can be transferred under a BSA, to include a corporation, a partnership or a limited liability company. A BSA is effective whether your business has one owner or multiple owners.
As a contract, a BSA is binding on third parties such as your estate representatives and heirs. This feature can be invaluable when you want to ensure a smooth transition of complete control and ownership to the party that will keep the business going. Subject to certain Family Attribution Rules under Internal Revenue Code § 318, a BSA can help establish a value for your business that is binding on the IRS for federal estate tax purposes, as provided under Internal Revenue Code § 2703.
A BSA is commonly structured in one of three general formats: an Entity BSA, a Cross-Purchase BSA or a Wait-And-See BSA. Under an Entity BSA, the business entity itself agrees to purchase the interest of a business owner. Conversely, under a Cross-Purchase BSA, the business owners agree to purchase one another’s interests. The Wait-And-See BSA gives the entity a first option to purchase the interest before the remaining business owner(s).
In addition to these three general formats, a One-Way BSA may be used when there is one business owner, and the purchaser is a third party. The selection of the appropriate BSA format is critical for a variety of tax and non-tax reasons beyond the scope of this discussion—our estate planning team can help you determine what’s right for your needs. However, no BSA is complete without a proper funding plan. Like a beautiful automobile without fuel in the tank, a BSA without cash to fund the purchase is going nowhere.
Some common options to fund the purchase obligation under a BSA include the use of personal funds, creating a sinking fund in the business itself, borrowing funds, installment payments and insurance. Of these options, only the insured option can guarantee complete financing of the purchase from the beginning. Accordingly, a proper BSA will include both disability buy-out insurance and life insurance. Since your health determines your insurability, any delay in acquiring appropriate coverage could be fatal to the success of the BSA and, with it, the survival of your business itself.
Charitable Planning in Rocklin, California
Giving to your favorite charities can be personally rewarding—but it can benefit your estate plan, too.
Most charitable gifts also provide a current income tax deduction. Some charitable giving strategies also save capital gains taxes, increase income, and provide you, or whomever you designate, with an income for life. Additionally, these types of gifts may provide an estate tax deduction—an important consideration in planning your estate.
If given the choice between paying taxes (involuntary philanthropy), or making a charitable gift (voluntary philanthropy), you would probably choose the latter. Charitable giving allows you the benefit of knowing who the money will benefit and how it will be used. The same cannot be said for money paid to the U.S. Treasury. The team at Goff Legal, PC can help you make charitable gifts and practice good stewardship—in the most tax-efficient manner.
Charitable giving and estate planning can be quite complex. If there are causes or organizations you would like to support, while also maximizing your tax-saving strategies, please contact us to explore your options.
Estate Tax Planning in Rocklin
It’s hard to plan for estate taxes, if you don’t understand how they will affect your family.
Historically speaking, the federal estate tax is an excise tax levied on the transfer of a person’s assets after death. In actuality, it is neither a death tax nor an inheritance tax, but rather a transfer tax.
There are three distinct aspects to federal wealth transfer taxes that comprise what is called the Unified Transfer Tax: Estate Taxes, Gift Taxes, and Generation-Skipping Transfer Taxes. The team at Goff Legal, PC will use our expertise to help your family avoid or minimize these taxes.
The most recent iteration of the federal estate, gift, and generation-skipping transfer tax was signed into law by President Trump on December 22, 2017, as part of the Tax Cuts and Jobs Act of 2017 (TCJA 2017). There are a few things you ought to know about this law, which took effect on January 1, 2018. Specifically, you should know the “numbers” governing transfers subject to estate, gift, and generation-skipping transfer taxation.
A $5 million exemption, as indexed for inflation, was signed into law on December 17, 2010, under the Tax Relief, Unemployment Insurance Authorization, and Job Creation Act of 2010 (TRA 2010).
By 2017, the federal estate tax exemption had risen to $5.49 million per individual, due to the inflation feature (and a nearly “automatic”* $10.98 million for married couples who follow very specific requirements at the death of the first spouse). With the stroke of his pen on December 22, 2017, President Donald Trump increased this exemption to $11,200,000 per individual (and $22,400,000 for married couples). The tax rate for amounts above what can be exempted remains at 40 percent.
* See “Portability” below for more on this.
The TCJA 2017 continues the concept of a unified exemption that ties together the gift tax and the estate tax. This means that to the extent you utilize your lifetime gift tax exemption while living, your federal estate tax exemption at death will be reduced accordingly. Your unified lifetime gift and estate tax exemption in 2017 was $5.49 million and is now the same as the federal estate tax exemption of $11,200,000 per individual (and $22,400,000 for married couples). Likewise, the top tax rate is 40%. Note: Gifts made within your annual gift exclusion amount do not count against your unified lifetime gift and estate tax exemption.
So, how much is this annual gift exclusion?
The annual gift exclusion has increased to $16,000 due to its inflation adjustment. This is up from $15,000 for 2021. Married couples can combine their annual gift exclusion amounts to make tax-exempt gifts totaling $32,000 to as many individuals as they choose each year, whether both spouses contribute equally, or if the entire gift comes from one spouse. In the latter instance, the couple must file an IRS Form 709 Gift Tax return and elect “gift-splitting” for the tax year in which such gift was made.
What is GSTT? Basically, it is a transfer tax on property passing from one generation to another generation, which is two or more generational levels below the transferring generation. For instance, a transfer from a grandparent to a grandchild, or from one individual to another unrelated individual who is more than 37.5 years younger than the transferor.
Properly done, this can transfer significant wealth between generations.
The amount that can escape federal estate taxation between generations, otherwise known as the Generation-Skipping Transfer Tax Exemption (GSTT) is unified with the federal estate tax exemption and the lifetime gift tax exemption at $11,200,000 per individual (and $22,400,000 for married couples, subject to certain specific requirements). As with estate and gift taxes, the top GSTT tax rate is 40 percent.
The American Taxpayer Relief Act of 2012 (ATRA 2012), made “permanent” a new concept in estate planning for married couples. This ostensibly renders traditional estate tax planning unnecessary. This concept, called “portability,” means that a surviving spouse can essentially inherit the estate tax exemption of the deceased spouse, without the use of “A-B Trust” planning. As with most tax laws, however, the devil is in the details. For example, unless the surviving spouse files a timely (within nine months of death) Form 709 Estate Tax Return and complies with other requirements, the portability may be unavailable.
In addition, married couples will not be able to use the GSTT exemptions of both spouses if they elect to use “portability” as the means to secure their respective estate tax exemptions. Furthermore, reliance on “portability” in the context of blended families may result in unintentional disinheritances and other unpleasant consequences.
If you are concerned about how your current estate and gift planning may function in light of ATRA 2012, and after that, then we encourage you to schedule a consultation. Our attorneys can help you plan for the latest iterations of the federal estate tax.
California’s estate tax system is commonly referred to as a “pick up” tax. This is because California picks up all or a portion of the credit for state death taxes allowed on the federal estate tax return (federal form 706 or 706NA).
Since there is no longer a federal credit for state estate taxes on the federal estate tax return, there is no longer basis for the California estate tax. California has neither an estate tax (a tax paid by the estate), nor an inheritance tax (a tax paid by a recipient of a gift from an estate).
Goff Legal, PC can help you understand the intricacies of estate taxes. Schedule a consultation today to review your estate plan.
California Probate, Estate and Trust Administration
When you lose a loved one, probate is the last thing you want to deal with. While you’re trying to work through your grief and pain, the external stresses of probate can lead to disaster. A comprehensive estate plan is the best way to ensure your family is protected—and that starts with choosing the right executor or administrator. If you’ve been chosen to act as someone else’s executor, we can help.
The fundamental duties of a personal representative (also known as an “executor,” if male, or an “executrix,” if female) of an estate are the same as those of a trustee–protecting the assets and interests of the beneficiaries. One way to protect those assets and interests and, at the same time, help the probate process go smoothly, is to have all of your ducks in a row and prepare for court as best you can.
A personal representative is required to prepare and file an inventory and a list of claims after the representative is approved by the court. The timeframe for this important chore is set by statute. This inventory should detail all of the assets subject to probate (i.e., that did not pass outside of probate by operation of law or otherwise, according to your estate plan). The property must be valued and even appraised as necessary. The claims include debts due and owing to your estate (not debts the estate owes to another party). The inventory provides both potential beneficiaries and creditors of the estate an idea of the estate’s assets and claims. Beneficiaries want to know what they might get, and creditors want to know if there is enough money to get paid. If the inventory is filed late, the representative could be fined and removed, which would slow down the process (and raise tempers).
One thing to note if you are a beneficiary is that the will may be “read” a few days after the funeral, but the gifts and bequests are not given out at that time. Yes, you may be entitled to the assets, but the inheritance is subject to the estate’s administration. The representative must settle the decedent’s debts and claims before they can make any distribution of the assets. So, beneficiaries, do not go to Grandma’s house with a moving truck and start taking whatever you want. Most likely, the representative is doing their job and making sure everything stays where it is until probate is closed.
As noted above, the representative must also keep the administration process moving along by settling all of the decedent’s debts. They must give proper notices to creditors, to include making publication in the appropriate newspaper and sending written notice to known secured creditors by certified mail.
Some representatives are under the mistaken impression that all debts must be paid. They may begin paying the decedent’s bills immediately, which is not necessarily good. Some states provide “permissive notice” to unsecured creditors, and this may avoid paying some unsecured claims. Working with the advisors at Goff Legal, PC can ensure that you don’t unnecessarily pay certain debts.
The representative must keep the beneficiaries in the loop, including providing each with notice via certified mail that the will has been admitted to probate, and a copy of the will. In addition, the representative must inform the beneficiaries regarding any information that might affect their rights. For instance, beneficiaries have the right to ask for a formal accounting by the independent executor.
The representative is responsible for the care and maintenance of estate property, treating it with even greater care than his or her own property. The representative is able to sell any property that is perishable or would deteriorate in value during the probate process.
As you can see, being a representative is a big job. Consequently, you can be removed if proven to have been guilty of any gross misconduct or mismanagement in the role of representative. You may even be subject to a suit for breach of fiduciary duty. Along the way, there are taxes to be paid and returns to be filed, along with many other details.
So you see, there is more than a little pressure on the personal representative. As a result, it is essential that you get help. The team at Goff Legal, PC can guide representatives or beneficiaries during this process … and avoid all of the hidden landmines.
Pet Planning in Rocklin, CA
Owning pets is a wonderful thing (some would say it’s the only way to live!). What happens if your pet outlives you?
There are many legal and financial hurdles that accompany pet ownership, specifically regarding your estate plan. Our pet-focused estate planning attorneys can provide you with the guidance you need to make the right decisions for you and the pets in your life and upon your passing.
I am Alexandria Goff, an attorney and pet lover in Loomis, California. My clients include pet owners and operators of farms and pet-related businesses in Placer County, Nevada County, El Dorado Hills and throughout the surrounding areas.
I have had various pets since I was five years old, including horses, goats, chickens, cats, dogs and rats. My legal knowledge and pet sense can help you navigate some of the estate planning issues that accompany pet ownership, including:
Please note: I am not a civil litigator, so I cannot help if you have an issue that is regarding a dispute of pet ownership or other civil disputes relating to pets. I may be able to provide you with a referral if you contact the office.
Let me help you take care of your pets. Reach out to me by telephone at 916-260-2621 or contact me online by filling out a brief contact form. I will work with you personally to help you to incorporate your pets into your plan, so that you know they will be taken care of if something happens to you. I can also represent you in estate and probate matters, and am well-versed in the many ways in which these legal issues intersect with pet planning.
(Why couldn’t the pony sing? Because he was a little hoarse!)
Special Needs Estate Planning in Rocklin, CA
Serving Individuals throughout Rocklin, CA and the Surrounding Areas
Single people need estate plans, too. According to the most recent U.S. Census, more than half of all adult Americans are single. It doesn’t matter whether you’re 18 or 118, both you and your married counterparts need to undertake essential estate planning.
You might think that you don’t need an estate plan—especially if you don’t own any considerable assets. However, the reality is quite different. Even if you don’t have two dimes to rub together, you are your estate. Did you know the law requires every adult American to make his or her own personal, financial and health care decisions? Who would make your basic decisions if you are legally incapacitated, due to a serious injury or illness?
Unless you legally appoint the decision-maker of your own selection in advance through proper estate planning, then a probate judge will select one for you. The process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record and is a real hassle for your loved ones in their time of distress. Worse, you might get a representative whom you don’t trust—and you won’t be able to do a thing about it.
But wait, there’s more. Did you know that in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws (intestacy laws), written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your loved ones and assets.
Fortunately, we can help you avoid probate and replace impersonal, state-written, one-size-fits-all estate plan with one we design together, created specifically for your unique circumstances and objectives. We even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences.
Don’t make the mistake of assuming single people don’t need estate plans. We can help you create a plan that meets your needs, no matter the size of your estate.
Serving Families and Individuals throughout Rocklin, CA and the Surrounding Areas
With each marriage comes new rights and new responsibilities. Whether you had an estate plan when you were single or you’re starting from scratch, your estate plan should reflect your new lives together.
Unfortunately, many married couples mistakenly believe that they can make personal, health care and financial decisions for one another, should either spouse become legally incapacitated due to a serious injury or illness. Nothing could be further from reality!
Without proper advance estate planning to appoint your spouse as the incapacity decision-maker, your spouse will not have the legal authority to make even basic decisions for you (or affecting both of you). For example, medical privacy laws will bar access to your medical records and the ability to consult with your attending physician, financial laws limit control over your finances, and IRS regulations will prohibit filing a “legal” joint income tax return…and that’s just the beginning.
Unless you legally appoint the decision-maker of your own selection in advance through proper estate planning, then a probate judge will select one for you. While the judge will likely appoint your spouse, the probate court process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record and is a real hassle for your spouse.
Even if you’re young and healthy, you still need a comprehensive estate plan. Did you know that in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws, written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets. In fact, depending on how you titled your premarital assets and how your beneficiary designations are arranged, you may disinherit your spouse—and force your spouse to sue your estate!
Fortunately, the team at Goff Legal, PC can help you avoid probate and replace that impersonal, state-written, one-size-fits-all estate plan with one we design together for your unique circumstances and objectives. We will even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences. Contact us for a consultation today.
Serving Families throughout Rocklin, CA and the Surrounding Areas
Times have changed. In the new millennium, whether due to the death of a spouse or through divorce, blended families now outnumber traditional nuclear families. And the number is likely to grow, based on current statistics and trends. If you’re part of a blended family, you may have unique estate planning goals and challenges to consider.
Many blended families face unique social, psychological and economic problems. As a result, over 60 percent of second marriages end in divorce. Fortunately, there are numerous organizations and support groups dedicated to helping blended families with these challenges—including the estate planning attorneys at Goff Legal, PC.
Unfortunately, little attention has been paid to the critical estate planning challenges confronting blended families. These challenges include disinheriting your ex-spouse and protecting your children. If you already have an estate plan created when you were previously married, then we can help bring it up-to-date, to reflect your new wedding vows.
Without proper legal planning, your ex-spouse (as surviving parent/guardian) would likely be appointed by the probate court to manage the inheritance you leave to your minor children. To make matters worse, what if your children later predecease your ex-spouse, and are single and childless at that time? Who would inherit your assets? That’s right: your ex-spouse, as your children’s next-of-kin.
Chances are, you made a few solemn promises to your new spouse on your wedding day. Among them were promises to be there through thick and thin, both personally and financially. In the absence of a premarital agreement to maintain separate assets, most spouses in blended families tend to blend their wealth. For instance, they title their respective assets in the names of both spouses and also designate one another as the primary beneficiary of their respective retirement plans and life insurance policies.
Warning: If you predecease your new spouse, you run the risk of forever disinheriting your own children from your share of blended wealth. Thereafter, upon the death of your new spouse, your assets may be inherited by your stepchildren, or even by your new spouse’s next spouse and their children. Things can get complicated—and fast.
Regardless of whether your children are reared in a traditional nuclear family or in a blended family, great care should be given to protect any inheritance both for them—and from them. For example, your lifetime of hard-earned wealth can be squandered very quickly. Dollars earned just spend differently than dollars inherited. In addition to good old-fashioned spendthrifts, an inheritance can quickly vanish through divorces, lawsuits and bankruptcies.
There’s a solution. With proper (and very careful) estate planning, you can both honor your vows to your new spouse and provide an inheritance that is protected for and even from your own children. When you’re beginning a blended family, Goff Legal, PC can help.
Serving Families and Individuals throughout Rocklin, CA and the Surrounding Areas
Are you the parent of minor children? If yes, you already know they are your most valuable treasure. So, what arrangements have you made for their care should something happen to you and their other parent?
You’ve already selected guardians and representatives for your own personal, healthcare and financial decisions. It’s even more crucial to do the same for your kids. Otherwise, a probate judge will make the selection. Proper estate planning ensures that you select the right guardians for your children.
There are two critical choices commonly faced by parents of minor children. First, who will take care of my minor children, if orphaned, and second, who will manage their inheritance?
If you are separated, divorced or never married to the surviving biological parent of your shared minor children, then that parent will continue to be their guardian, absent a court-proven case of unfitness. Nevertheless, you will want to make prudent choices regarding guardianship if you and their other parent should suddenly pass.
While every family situation is unique, here are some general practical pointers to consider when selecting guardians for your minor children:
Great care must be taken when selecting a financial fiduciary to administer and distribute the inheritance. Simply put, your fiduciary is a person or institution legally responsible for the financial affairs of another. Fiduciaries are held to the highest standards of care and loyalty in this role—and because they’ll be taking care of your children’s inheritance, you want to pick the best person possible.
Who will manage any inheritance left upon your death? What if you and the other biological parent are divorced or were never married? Even though he or she may rear your minor child or children to adulthood, would you also want them to control the inheritance you leave behind, too?
There are three basic options when it comes to financial fiduciaries, each with its unique advantages and disadvantages.
Option 1 is the most common option. Here, you appoint trusted family members or friends. On the upside, they likely know the strengths and weaknesses of your loved ones. They may not charge much, if anything, to oversee the inheritance. On the other hand, they may be busy with and distracted by their own life and financial responsibilities. Also, they may find it difficult to say “no” to an irresponsible heir.
Option 2 is where you appoint a professional fiduciary, such as a licensed private fiduciary, or an institution (e.g., a trust company) or an individual (e.g., your attorney or CPA). The upsides and downsides are the opposite of Option 1.
Option 3 is what we call the Pro-Am approach: combine Option 1 and Option 2 for the best of both worlds. In short, the family appointee knows the applicable strengths and weakness, has an “abominable no-man” to help preserve family relationships when the minor child asks for a Ferrari, and is not bogged down with investments, accounting, tax and legal details. Instead, the professional fiduciary shoulders (and is rightfully compensated for) the day-to-day management of the inheritance, playing the heavy when necessary.
As you can see, selecting guardians and fiduciaries is essential for the physical and financial well-being of your minor children. Few decisions in life are more important. Only you can make these decisions through proper estate planning—but the team at Goff Legal, PC can help.
Serving Families and Individuals throughout Rocklin, CA and the Surrounding Areas
Are you between age 40 and 55? If yes, then congratulations! Research has shown that you are in your peak earning years—and that is a very good thing.
Chances are good that you have some expensive life events going on right now, unlike when you were among the Married Couples without children. Do you have children who are college-bound or already there? Do you have a wedding scheduled (or one or more down the road)? Perhaps you are beginning to help aging parents with personal, health care and financial responsibilities.
You’re probably busy and very tired—who isn’t? Nevertheless, this is a good time to create (or revisit) your estate plan, to ensure that your adult children and parents have their legal ducks in a row.
Many married couples mistakenly believe that they can make personal, health care and financial decisions for one another should either spouse become legally incapacitated due to a serious injury or illness. Nothing could be further from reality.
Without proper estate planning—in advance—to appoint your spouse as the incapacity decision-maker, he or she will not have legal authority to make even fundamental decisions for you or both of you.
For example, medical privacy laws will bar access to your medical records and the ability to consult with your attending physician, financial laws limit control over your finances, and IRS regulations will prohibit filing a “legal” joint income tax return…and that’s just the beginning.
Unless you legally appoint the decision-maker of your own selection, in advance, through proper estate planning, then a probate judge will select one for you. While the judge will likely appoint your spouse, the probate court process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record and is a real hassle for your spouse.
Did you know that in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws, written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets.
In fact, depending on how you titled your assets and how your beneficiary designations are arranged, you may disinherit your own spouse and force your spouse to sue your estate!
When it comes to your children, great care should be given to protect any inheritance both for them and from them. For starters, wealth representing a lifetime of your hard work and thrift can be squandered in very short order. Dollars earned just spend differently than dollars inherited. In addition to good, old-fashioned squandering, an inheritance can quickly vanish through divorces, lawsuits and bankruptcies.
Fortunately, with proper (and very careful) estate planning, you can provide an inheritance that is protected for and even from your own children. Remember, two things you cannot choose in life are your own folks—and the spouses of your children.
Next, it’s time to consider your elderly parents. Are your parents already in or considering a transition to some form of long-term care? If yes, have you noticed how expensive the continuum of care is? From in-home assistance to assisted living to skilled nursing, the expenses can destroy savings and investments created over a lifetime of hard work and thrift. You need a good estate plan.
Your peak earning years are the perfect time to lock-in a long-term care insurance policy while you are still able to qualify, physically and mentally. Some versions of coverage only pay if you need long-term care assistance. Others can now do double-duty and turn into life insurance if you do not need such assistance. This is a popular alternative to traditional long-term care insurance.
There is a 70 percent risk of needing long-term care once you reach age 65. Curiously, 70 percent of people think they will not be among those 70 percent needing care (i.e., denial) and 70 percent of people think Medicare will pay for it (i.e., ignorance)! You do not want to be in that 70 percent who are in denial, ignorant or both.
What happens when you’re the one who needs help? If you need assistance with the activities of daily living (e.g., eating, bathing, dressing, toileting, and transferring), then you may want to hire a professional to take care of you, instead of relying on your children, who may not be able to take on that role.
When you are ready for help with your long-term care planning through appropriate insurance, then we can help you find that, as well.
The compassionate team at Goff Legal, PC can help you avoid probate and replace that impersonal, state-written, one-size-fits-all estate plan with one we design together for your unique circumstances and objectives. We even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences.
Serving Families and Individuals throughout Rocklin, CA and the Surrounding Areas
Just a moment ago you were in the thick of your busy, busy Peak Earning Years. Now, you can see a new adventure is rapidly approaching your front windshield. What is it?
Retirement. Are you ready?
Chances are good that your children have left the nest. Perhaps you are assisting your aging parents with their personal, healthcare and financial responsibilities.
As in your Peak Earning Years, this would be a good time to create (or revisit) your estate plan, and make sure your adult children and parents have everything in order, too.
Unfortunately, many married couples mistakenly believe that they can make personal, health care and financial decisions for one another should either spouse become legally incapacitated due to a serious injury or illness. This couldn’t be further from reality.
Without proper estate planning in advance to appoint your spouse as the incapacity decision-maker, he or she will not have legal authority to make even fundamental decisions for you (or affecting both of you). For example, medical privacy laws will bar access to your medical records and the ability to consult with your attending physician, financial laws limit control over your finances, and IRS regulations will prohibit filing a “legal” joint income tax return … and that’s just the beginning.
Unless you legally appoint the decision-maker of your own selection in advance through proper estate planning, a probate judge will select one for you. While the judge will likely appoint your spouse, the probate court process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record and is a real hassle for your spouse.
Worse yet, in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets.
In fact, depending on how you titled your assets and how your beneficiary designations are arranged, you may disinherit your own spouse and force your spouse to sue your estate!
Now, let’s consider something no married couple wants to think about: what if one spouse dies and the other remarries?
In a recent University of California study, researchers found that 60 percent of widowers are involved in a new relationship within two years after losing their wives, while only 20 percent of widows have a new relationship.
According to the U.S. Census Bureau, men are 10 times more likely to remarry after age 65. And the average time before they are remarried is just 2.5 years. When Dad remarries a new wife some 20 years his junior, that can trigger drama—but an excellent estate plan can assuage all of those worries.
If you want to risk losing about half of what you have, should the remarriage not work out, or disinheriting your own children and grandchildren, then do nothing. No matter how much you love your new partner, it’s best to go into the relationship with both eyes open—and skilled legal estate planning assistance.
In short, the surviving spouse needs to have a legally enforceable premarital agreement inked before saying “I do” on his or her wedding day.
As you can see, planning for being single again includes planning for any new relationships on the future, while preserving (and protecting) the relationships you already have.
When it comes to your children, great care should be given to protect any inheritance—both for them and from them. Your bounty from a lifetime of your hard work and thrift can be squandered in very short order. Dollars earned spend differently than dollars inherited. In addition to squandering, your legacy can vanish through bankruptcies, divorces and more.
Fortunately, with skillfully guided estate planning, you can provide an inheritance that is protected for, and even from, your own children. Remember: two things you cannot choose in life are your own folks and the spouses of your children.
Have you noticed how expensive the continuum of care is? From in-home assistance to assisted living to skilled nursing, the expenses can destroy savings and investments created over a lifetime of hard work and thrift.
As you near retirement, it’s important to lock in a long-term care insurance policy while you are still able to qualify physically and mentally. Some versions of coverage only pay if you need long-term care assistance. Others can now do double-duty and turn into life insurance if you do not need such assistance. That is a popular alternative to traditional long-term care insurance.
There is a 70 percent risk of needing long-term care once you reach age 65. However, 70 percent of people think they will not be among those 70 percent needing care (i.e., denial) and 70 percent of people think Medicare will pay for it (i.e., ignorance)! You do not want to be in that 70 percent who are in denial, ignorant or both.
If you will need assistance with the activities of daily living (e.g., eating, bathing, dressing, toileting, and transferring), then you may want to hire a professional to take care of you, instead of your children. There’s no guarantee that your adult children will be able or willing to take care of you in the way you need.
When you are ready for help with your long-term care planning through appropriate insurance, then the attorneys at Goff Legal, PC can help.
When you work with our attorneys, we can help you avoid probate and replace that impersonal, state-written, one-size-fits-all estate plan with a custom plan designed to meet your every need. We even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences. Call or fill out our contact form today to get skilled help, fast.
Serving Families and Individuals throughout Rocklin, CA and the Surrounding Areas
You have arrived. Just a moment ago you were Nearing Retirement. Now, finally, the exciting and bittersweet day is almost here. When did you get to this place in life so quickly? Yikes.
So what do you need to do, right now, in preparation for that day?
If you have children, chances are that they’ve left the nest and have families of their own. If they are living, perhaps you are becoming parents to your parents (or the surviving parent), just like their parents before them. You’re at the end of your working years—but your responsibilities are as important as ever.
All major changes in life require an update to the estate plan, and this time is no different. If you and your spouse don’t have a comprehensive estate plan, you might not be able to make the crucial healthcare, financial or other decisions necessary when one spouse is incapacitated. Worse, a probate judge will appoint a decision-maker for you—and it might not be your spouse. This process is expensive, exposes your personal and financial information to the public record, and is frustrating and upsetting for your spouse at the worst possible time.
There’s also estate planning to consider. Did you know that in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets. In fact, depending on how you titled your assets and how your beneficiary designations are arranged, you may disinherit your own spouse and force your spouse to sue your estate.
There’s another worst-case scenario to consider: what if one spouse dies and the other remarries?
If you want to risk losing about half of what you have, should the remarriage not work out, or disinheriting your own children and grandchildren, then do nothing. However, it’s always prudent to have a comprehensive estate plan, which accounts for all possible issues. In short, the surviving spouse should have a legally enforceable premarital agreement inked before saying “I do” on their wedding day.
As you can see, planning for being single again includes planning for any new relationships on the future, while preserving (and protecting) the relationships you already have.
Long-term care is expensive—and if you don’t plan properly, your estate will suffer.
The attorneys at Goff Legal, PC can help you plan for long-term issues. If you will need assistance with the activities of daily living (e.g., eating, bathing, dressing, toileting, and transferring), then you may want to hire a professional to take care of you instead of your children. After all, there’s no guarantee that your children will be able or willing to help—especially if they have families of their own. Don’t fall into the “this will never happen to me” trap. Planning ahead ensures your peace of mind—and guarantees that you’ll be taken care of, no matter how long you live.
When you are ready for help with your long-term care planning through appropriate insurance, then we can help you find that, too.
Your retirement planning should include a few different touchstones: wills, trusts, powers of attorney and more. The lawyers at Goff Legal, PC can help you avoid probate and replace that impersonal, state-written, one-size-fits-all estate plan with one we design together for your unique circumstances and objectives.
We even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences. For example, all beneficiary designations for your retirement plans need to be revisited, especially due to a U.S. Supreme Court decision handed down on June 12, 2014, (See Clark, et ux v. Rameker).
The Clark case sent shock waves through the estate planning community after a unanimous court ruled that inherited IRAs are not “retirement funds” within the meaning of federal bankruptcy law. Accordingly, if your children or grandchildren are “direct” designated beneficiaries of your IRA, then the distributions may be subject to their divorces, lawsuits, and bankruptcies. Careful planning is required to protect these important assets, while at the same time preserving the ability to stretch distributions as long as possible for your beneficiaries.
Serving Individuals throughout Rocklin, CA and the Surrounding Areas
Whether due to divorce or death, you are now single again. You may have children and even grandchildren. Whatever your circumstances, you need to create (or revisit) your estate plan.
Now that you are single again, who would make your basic decisions if you are legally incapacitated due to a serious injury or illness? This is your opportunity to chart your own course—and make sure that you have appropriate help if you’re incapacitated. From determining who can make healthcare and financial decisions, to new wills and trusts considerations, it’s time to take control of your estate planning needs.
One of the best parts about divorce is the opportunity to start afresh, no matter what your age or financial status. However, you still need to plan to protect your children and grandchildren—as well as any other people you may welcome into your family.
Fortunately, the trusted lawyers at Goff Legal, PC can help you avoid probate and replace that impersonal, state-written, one-size-fits-all estate plan with one we design together for your unique circumstances and objectives. We even help you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences.
