ESTATE PLANNING

Published on: August 18, 2008

Reverse Mortgages and Estate Planning

Reverse mortgages have become extremely popular in California and especially in San Diego communities with a large senior population such as Rancho Bernardo, Poway, Ramona, and Oceanside.

If you have a reverse mortgage already or are thinking about getting one, useful information about reverse mortgages is available fromthe U.S. Dept. of Housing and Urban Development (HUD). AARP also has information and a list of questions to ask yourself before making the decision to apply for one.

Remember from an estate planning perspective, the lender may ask you to take your home out of your living trust to accomplish the reverse mortgage. Make sure your home is put back into the trust after the mortgage is in place. This means that there is a grant deed or quitclaim deed showing the property titled in your name as Trustee. When the deed has been recorded with the County Recorder, you home is then “put back” into your trust. This process may be done by whoever handled the mortgage paperwork but it is a good idea to verify that it has in fact been done since your home is often the major asset of your estate. You do not want to pass away with a major asset left out of your trust.

Published on: August 14, 2008

Dying Green in San Diego

by Scott C. Soady

In San Diego many people are going “green” – trying to conserve our planet’s resources and natural environment for the next generation. Now there is growing trend toward “green burials” where the body is returned to the earth to decompose. No chemicals are used to embalm the body and it is laid to rest in a shroud or biodegradable casket. The first “green cemetery” in California is in Mill Valley in northern California. At Fernwood Cemetery they use no embalming fluids, only biodegradable caskets, and trees and scrubs as markers. In San Diego county, the funeral services company, Thresholds, in Lakeside, provides in home funerals and ecologically friendly burials.

According to Wikipedia, U. S. cemeteries deposit into the ground 827,00 gallons of embalming fluid, 30 million feet of hardwood, 90,000 tons of steel, 2700 tons of copper and bronze and over 1 million tons of concrete each year. Even cremation, although better for the earth than burial, leaves carbon ash that doesn’t decompose. The “green burial” movement is trying to alleviate this impact on our environment by encouraging burials without embalming, caskets that will disintegrate, and even cemeteries with no marble markers, metal vaults, or lawns that require fertilizer and pesticides.

For more information on “green burials” you can visit the Green Burial Council website. If you need to incorporate “green” provisions into your will or trust, call or e mail us at Law Office of Scott C. Soady, A Professional Corporation, LLP. Our initial in-house consultation is complementary.

Published on: August 11, 2008

Medi-Cal Planning for San Diego Seniors

by Scott C. Soady

New facilities are springing up all over the county for seniors in such areas as Escondido, Encinitas, San Marcos, and Vista. Some facilities have a resort type atmosphere and some even specialize in dementia and Alzheimer care. You can obtain a directory of senior facilities for assisted living, independent, and convalescent care from Alternatives for Seniors.

Moving a loved one to an assisted living, nursing home or convalescent home is not an easy decision. Particularly troublesome is how to pay for such care when one spouse needs to be cared for in a facility and the other wants to remain at home. Such specialized care can be expensive and impossible for many people to pay for out of pocket. It is estimated that long term care can cost $40,000 – $60,000 per year in some areas. Medicare typically will not pay for long term care. Some people have policies of long term health care which may partially cover such costs but if the insurance was not purchased when the individual was healthy, it is not going to be possible to obtain insurance once it seems evident that long term care will be necessary.

Medi-Cal is the California Medicaid system for people 65 or older with limited income and financial resources. Medi-Cal may pay for long term care however its rules and regulations are constantly changing and often confusing for the average person. At Law Office of Scott C. Soady, A Professional Corporation we can help you with Medi-Cal planning, which is the process of qualifying for benefits while still protecting assets that have taken you a lifetime to accumulate. Call or e mail us to set up a complimentary consultation.

Published on: August 7, 2008

Do Your Favorite San Diego Charities Use Donated Funds Efficiently?

by Scott C. Soady

At our web site, you can read about the various ways to accomplish charitable giving. You can use a bequest in your will or trust or one of the various types of charitable trusts such as a charitable remainder trust or a charitable lead trust. At Law Office of Scott C. Soady, A Professional Corporation we can incorporate your charitable wishes into a will or a revocable living trust. If you are considering leaving part of your estate to charity, you may wonder how do you choose one and how do you know whether that charity will use your gift wisely?

There is a way to find out such things as how efficient a charity is, how much of the donated dollars goes to administrative purposes, and how much to the actual programs. Charity Navigator rates charities using a standard of “no stars” to “4 stars” to rate charities in the areas of organizational efficiency and organizational capacity. The site also has useful information about what questions to ask before choosing a charity such as what are the charity’s goals, is it meeting those goals with its programs, is the charity well-managed, and is it a confirmed 501(c)charity (this means the charity has filed with the IRS as a tax-exempt non-profit organization).

4 Star charities in San Diego include the San Diego Zoological Society, San Diego Symphony, Autism Research Institute, Father Joe’s Village, Rady Children’s Hospital Foundation, San Diego Humane Society, and the Jewish Community Foundation of San Diego. There are many other San Diego and International charities that earn the 4 star reputation. If you need more information on how to implement charitable giving in your estate plan, contact us at Law Office of Scott C. Soady, A Professional Corporation. You may call us or e mail us for a complimentary in-house consultation.

Published on: August 4, 2008

10 Things You Can’t Do Without a Will or Trust

by Scott C. Soady

If you die in San Diego without a will or a trust, you are deemed to have died “intestate”. To die “intestate” means to die without a “testament” (a will) or a trust and your estate will have to go through the probate process where the Probate Court will determine where your estate will go. This can result in unintended results for some people and not what they would have wanted.

As an example, most people believe that if they are married and they die without a will or a trust, all their property will go to their surviving spouse. That is not the case in California. If you are married with children, your community property(essentially property acquired during the marriage) will go to your spouse, but only one-half of the separate property (property acquired before marriage or inherited during the marriage) will go to your spouse if there is one child of the marriage. If you have 2 or more children, your spouse will only receive one-third of the separate property. This can be an unintended result if the estate is small and the surviving spouse needs all the assets in the estate to live on. Furthermore, California inheritance laws only recognize relatives of the intestate decedent, so the Probate Court can never distribute any of the estate to charities or non relatives.

Here are 10 example of things you cannot do if you die intestate:

Published on: July 25, 2008

Living Trusts Vital for San Diego Blended Families

by Scott C. Soady

More and more families in San Diego county are “blended families” (families that include children from previous marriages or relationships). It is estimated that 50% of first marriages end in divorce and that there are now more “blended families” in the county than traditional families.

Blended families face a number of challenges, not the least of which is estate planning. Many couples each have children from previous marriages and may have children of their marriage together. How is a trust created that will provide sufficient income for the surviving spouse and then after the second death, distribute the estate to the children of both spouses and their children together? What if the surviving spouse remarries and wants to leave assets to a new spouse or has additional children?

Another issue that can arise is if you have divorced and remarried but have no estate plan when you pass away. Your minor children may receive a portion of your estate through probate, but who will manage the children’s inheritance? Probably your ex-wife which may or may not be your preference.

Published on: July 18, 2008

Trust Administration in San Diego

by Scott C. Soady

Once you create a revocable living trust your job as the creator (often called the Trustor or Settlor of the trust) is to properly fund the trust initially and thereafter see that all the assets that should be placed in your trust are properly titled.

Once you pass away, the job of administering the trust is in the hands of your successor trustee. Your trust continues in existence and certain actions are necessary to carry out the purpose of the trust. These duties are done by your successor trustee. If you are the successor trustee of a trust, it is important to understand you have certain duties. These duties are called Trust Administration and may involve some or all of the following : paying the decedent’s debts, making an inventory of the trust’s assets, creating sub trusts if called for by the trust agreement, filing tax returns, transferring ownership of real property, notifying certain parties of the death (such as the Social Security Administration, Medi-Cal, and named beneficiaries), paying estate taxes within 9 months, paying property taxes on real property, selling certain assets, and making other decisions about investments if the trust is to continue.

Trust administration does take some time and attention to details. It often requires the assistance of an attorney to advise the successor trustee and assist him or her with the duties the job involves. If you need an experienced attorney to assist you as a trustee (or as a named beneficiary), call us or e mail us at Law Office of Scott C. Soady, A Professional Corporation and we will be pleased to offer you a complimentary consultation.

Published on: July 15, 2008

Do you have a Bucket List?

by Scott C. Soady

The movie The Bucket List recently came out in San Diego on DVD. This movie shows an unlikely pair of cancer patients (Morgan Freeman and Jack Nicholson) who compose a list of things they want to do before they die (places to visit, things they want to accomplish before they “kick the bucket.” ) In the movie, they sky dive, drive racing cars, get tatoos, and visit the Pyramids. You may have things you want to do which are a little less adventurous. Perhaps you have your own Bucket List of things you want to see and do in your lifetime. There are countless places in the world that would be fun to visit. There may even be some places you still haven’t seen in San Diego such as the beautiful beaches in La Jolla, Del Mar, or Solana Beach. Maybe you haven’t seen the beautiful view of the city from the Point Loma Lighthouse. There may be countless things you still need to say to the people you love.

While you are composing your own Bucket List, perhaps you should also consider creating an estate plan and setting forth what you want to happen upon your death. Although it may not be as much fun consulting an estate planning lawyer as it is to visit the Taj Mahal or Moonlight Beach, getting an estate plan will give you piece of mind. You can complete the rest of your Bucket List, knowing your affairs are in order and your estate will be distributed according to your wishes.

At Law Office of Scott C. Soady, A Professional Corporation, we can help you cross off “Create an Estate Plan” from your personal Bucket List. Call us or e mail us for a complimentary consultation.

Published on: July 12, 2008

San Diego South Bay – Estate Planning for Non-Citizen Spouses

by Scott C. Soady

In the South Bay communities of Chula Vista, National City, and San Ysidro, as well as elsewhere in San Diego County, there are many individuals who have spouses that are not U.S. citizens. Such couples have different estate planning concerns than those where both spouses are citizens.

In California when a spouse dies, the surviving spouse is entitled to an federal estate tax marital deduction. This permits the deceased spouse to leave unlimited assets to a surviving spouse, either outright or in a trust, with no estate tax liability. This only applies however if the surviving spouse is a U. S. citizen.

There is a solution to this problem. If you are a married couple and one spouse is not a U.S. citizen, the way to protect your assets is a with a special type of revocable living trust called a QDOT (Qualified Domestic Trust). A QDOT is a special type of marital trust that allows a non U.S. citizen spouse to inherit without being immediately obligated to pay estate taxes. These types of trusts are subject to strict requirements by the IRS and must be properly drafted to achieve this result.

Published on: July 10, 2008

San Diego Cats Enjoy Retirement Living in Spring Valley Thanks to a Pet Trust

by Scott C. Soady

Recently the San Diego Union reported the story of a cat named Teila living out her days on the grounds of the National Cat Protection Society in Spring Valley. This shelter opened in Spring Valley in 1975 but in 2000 a “retirement center” was built complete with a playroom, bedroom and shaded patio. They expect to continue to expand with places for cats to climb and explore in a tropical island atmosphere. The owner Gerri Calore, reports that one woman came in to view the center as a home for her 8 cats after her death. She is going to set up a pet trust which will include a lifetime care plan at the center. The owner says that the retirement center, while the first of its kind in San Diego, is a growing trend among pet owners.

A growing trend is also providing for pets in your will or trust. You can read about the various ways to handle estate planning for pets in an article about the subject on our website. If you would like to incorporate such ideas into your own estate plan, call us or e mail us. At Law Office of Scott C. Soady, A Professional Corporation we can assist with this or any other estate planning issue and offer a complimentary consultation..