San Diego Estate Planning Lawyer Blog

Published on: September 7, 2012

Basic Steps Following the Death of a Loved One

The first experience some have with estate planning issues occurs immediately after a loved one has passed away. This is unfortunate. Without any prior planning, a death comes with a range of complicated paperwork tasks–grieving relatives are often forced to handle complex affairs in the midst of great emotional turmoil. This is one reason why family feuds and in-fighting are quite common after the death of a loved one.

There remains a huge difference between no end-of-life planning and some planning.

A story on end-of-life planning in the upcoming issue of Consumer Reports offers some helpful guidance on the critical difference between dealing with the consequences of a death ahead of time and waiting until afterwards to figure it all out. Some matters have to be handled by family members and others can be dealt with by professionals.

Published on: August 28, 2012

Credit Card Debt at Death: Can Someone Else Be Responsible?

by Scott C. Soady

Estate planning is, in part, about making inheritance designations for assets left over after a passing. Of course, hand-in-hand with assets are debts. Understanding those potential debts at death, and making plans for the payment of all liabilities, is also factored into comprehensive estate plans dealing with long-term financial preparations.

This work is important for many reasons, not least of which is avoiding potential surprises where another is held personally responsible for debt accrued by the one who passed away. In general,

upon one’s passing, all of their debts are paid off first, with the remaining assets divvied out according to the wishes listed in planning documents. If one’s debts are larger than assets, those creditors may be forced to take a loss. Surviving family members are generally not liable for the unpaid debts

Published on: August 21, 2012

Bucking the Odds: Michael Jackson’s Will Leaves Little Legal Uncertainty

by Scott C. Soady

Most stories about celebrity estate planning have one thing in common: they involve planning errors and drawn-out legal battles. But it is important not to overlook the other examples–where planning documents are straight-forward and opportunity for challenges are few and far between. At the end of the day, when knowledgeable experts are used to create effective plans there is little or no confusion about how to handle affairs. This is true for celebrities and non-celebrities alike.

Take, for example, legendary pop star Michael Jackson. Considering Jackson’s colorful life and well-

known family controversies, one might assume that the battle over his estate would be fraught with similar drama. Not quite. Surprisingly, most familiar with the case explain that there is very little wiggle room for involved parties to challenge his will.

Published on: August 19, 2012

Rapper’s Death Highlights Difficult Planning Decisions — Naming Child Guardians

by Scott C. Soady

Planning one’s long-term affairs usually spurs thoughts about designating who will get what in an inheritance and explaining end of life wishes. But, there is much more to consider. For example,

planning for residents with young children must include difficult decisions about the long-term care of their kids in the event of death or disability.

This issue made national headlines in recent weeks following the untimely death of former musician Adam Yauch. Yauch is best known as one of the founding members of the groundbreaking rap group,

Published on: August 18, 2012

Do You Need to Update Your Will or Trust?

by Scott C. Soady

When most local residents think of “estate planning” one document comes to mind–a will. By far the most common planning tool, a will lays out one’s wishes in the event of their passing. While millions still have not even taken this most basic step, more and more local residents have visited with professionals to have a will drafted to help guide their family in the aftermath of their passing. Also, in our area a growing number of residents have visited a San Diego estate planning attorney to have slightly more sophisticated tools created–a trust–to protect assets and save on taxes down the road.

But even those who took the time to create a will or trust must not put estate planning issues completely out of their mind. That is because these documents must be updated at certain times to ensure they work as expected at the moment they are most needed.

A recent Forbes article delved into some of these issues. There are many situations when changes need to be made. Maintaining a good relationship with a legal professional is one of the best ways to ensure you are made aware of times when your plan should be tweaked.

Published on: August 16, 2012

Adding a Child to a Bank Account? Think Twice

by Scott C. Soady

For many local residents, visiting a San Diego estate planning attorney seems unnecessary. After all,

many seniors have loving, supportive families and a desire to split everything evenly. Aren’t there easier ways to take care of inheritance and long-term care issues than visiting a lawyer?

One of the most common shortcuts involves adding an adult child to a bank account. The idea is that the child can help with financial issues in case something happens to the older parent. While this is always done with good intentions, there are many pitfalls to this approach which many do not consider until it is too late. A few of the more common problems include…

Published on: August 14, 2012

Do-it-Yourself Estate Tax Pitfall

by Scott C. Soady

Dealing with the Internal Revenue Service (IRS) often confuses people and leads to complications. That holds true even in situations where the IRS has tried to simplify a process. Take, for example, the estate tax. As a new Wall Street Journal story this week mentions, new rules seeking to make it easier for couples to share assets and still receive the maximum estate tax exemption may lead to problems if families are not careful.

The Issue

In June the IRS offered guidance on federal estate tax laws. Under current law–set to expire at the end of this year–each individual can exempt $5.12 million of property from the tax. When taken together, a couple can therefore shelter over $10 million from these taxes. Yet, there were always complications when one spouse sought to leave everything to the other spouse, because this act essentially eliminated one half of the exemption. Transfers between spouses were not taxed, but upon the death of the second spouse the entire amount would be taxed with only the individual spouse’s exemption rate applying.

Published on: August 3, 2012

Family Story Highlights Importance of Updating Estate Planning Documents

by Scott C. Soady

Estate planning attorneys work with residents to plan for their financial future and plan inheritance issues for families. It is crucial not to forget that this planning does not occur with just one meeting. That’s because the plan must be edited from time to time to accommodate changes in the law, changes in family life, or changes in one’s long-term wishes. Failing to appreciate the need to update planning documents can have serious adverse effects.

For example, a recent Reuters article shared the story of estate planning gone awry and the legal ramifications of the failure to properly update these documents.

The Story

Published on: July 30, 2012

Amending a Trust

by Scott C. Soady

A trust is one of the most common tools that residents can use to craft unique estate plans so that their assets are passed on as efficiently as possible. However, many worry about using these tools for fear of their permanency, or wondering whether they can change their mind down the road. These are natural concerns that all residents should discuss when working on these issues.

If a settlor (person creating the trust) fails to include language in the trust that would make it revocable, he or she usually still has a statutory right to revoke or amend the trust.

But what about agents who act on one’s behalf with regard to the trust?

Published on: July 24, 2012

Taking Advantage of the Estate and Gift Tax Law

by Scott C. Soady

Much political debate raged in recent months (and years) about the federal gift and estate tax. While most of you have likely heard of the controversy, many of you are not exactly sure how these taxes could affect you and whether or not you need to do anything now to take advantage of current rates.

The Basics

The IRS defines the estate tax as “a tax on your right to transfer property at your death. It consists of an accounting of everything you own or have certain interests in at the date of death”.