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Friday, July 29, 2011 Recent Press Coverage of Estate Planning (July 29, 2011)
Saabira Chaudhuri of the Wall Street Journal notes that when completing your estate plan, you shouldn’t lose focus of some of the smaller, but important, details. One area often overlooked is what will happen to your pets. There are approximately 165 million dogs and cats in this country, and roughly 400,000 need to find a new home every year because their owners die. Also, if you have engaged in preserving sperm, eggs or embryos because you had cancer, were in the military or other high-risk occupation, don’t forget to spell what should happen to the cryopreserved gametes if you should die. See When Estate Plans Fail (July 23, 2011).
Kelly Greene of the Wall Street Journal stresses the importance of taking 15 minutes to write down your important user names and passwords for online accounts, including financial accounts, social networking accounts, and photo sites, among others. Without this information, your survivors could spend months trying to locate and access your important accounts. See PINs That Needle Families (July 23, 2011).
Paul Sullivan of the New York Times writes about charitable lead trusts (CLT) and why they are becoming popular again. The $5 million exemption level for the federal estate taxes alongside record low interest rates make CLTs good vehicles to pass more money to your heirs tax free. See A Trust Surges, Heirs and Taxes in Mind, But Mind the Details (July 22, 2011). Friday, July 22, 2011 Recent Press Coverage of Estate Planning (July 22, 2011)
Hani Sarji of Forbes notes that this is a great time to use gifts as an estate reduction strategy if you live in a state that has an estate tax threshold lower than the current federal estate tax threshold of $5 million per person ($10 million for a married couple). If you live in a state that has its own estate tax but no gift tax, like Vermont, then you can gift property during your life to reduce your estate value to less than the state estate tax exemption level, and still avoid gift taxes on the federal level. The current high gift exemption level extends only through 2012, so you need to plan ahead accordingly. See How to Cut State Death Taxes – Without Moving (July 13, 2011).
Jay Adkisson writes in Forbes about ten rules to keep in mind regarding asset protection. Most importantly, there are many strategies available if you start planning before a claim arises, but few that work after a claim or liability arises. And engaging in asset protection after a claim is filed is likely to make matters worse. Other rules include pairing asset protection with insurance, ensuring personal assets are not placed in business entities, and avoiding asset protection plans that are so complex they are hard to clearly explain. See Ten Rules for Asset Protection Planning (July 13, 2011).
Ashlea Ebeling of Forbes discusses ways to avoid a protracted battle over your estate. Advice includes treating siblings equally, making a list of specific items that should go to named heirs, keeping track of loans and advances, including a “no contest” clause, and spelling out clearly if you intend to disinherit someone. See 10 Ways to Lawsuit-Proof Your Estate (July 13, 2011).
Deborah L. Jacobs of Forbes reviews the unusually difficult challenges facing executors of people who died in 2010, a year when there was the option to avoid the federal estate tax (but pay capital gains taxes) or apply the estate tax law as it exists in 2011 with its $5 million exemption level. Issues include locating purchase records to determine cost basis for many assets, coping with new paperwork and forms issued by the IRS for this unusual year, and meeting the fiduciary obligations of impartiality when one of several available strategies benefits one group over another. See New Heirs Face Confusing Tax Choice (July 13, 2011).
Janet Novack of Forbes writes about ways to pass on frequent flyer rewards before or after you die. Each program has its own set of rules, but several allow a parent or grandparent to use their miles to purchase tickets for someone else. Also, ensure someone has your list of accounts, passwords and usernames, because some plans don’t allow transfer of points to an heir, but will allow someone to log on and redeem points after your death. See How to Pass On Your Frequent Flyer Miles (July 13, 2011). Friday, July 15, 2011 Recent Press Coverage of Estate Planning (July 15, 2011)
Saabira Chaudhuri of the Wall Street Journal wrote two articles about the importance of keeping your heirs aware of key documents, and where the documents can be found. Chaudhuri points out that some insurance companies are failing to pay out life insurance policies because the company may not be obligated to determine if a policyholder is alive, they simply pay a claim when beneficiaries come forward. The articles lists 25 key documents that your heirs should be able to find quickly after you die, and a follow-up article lists several more. See The 25 Documents You Need Before You Die (July 2, 2011) and Read This Before You Die (July 7, 2011).
Caren Chesler of Private Wealth reports that wealthy Americans are leaving more of their wealth to charities and less to their children. Reasons for the trend, according to a survey by U.S. Trust, include that parents believe their children won’t be able to handle an inheritance, that their children will become lazy, that their children will make poor decisions, and that their children would be taken advantage of by outsiders. See Tough Love (July 2011).
Arden Dale of the Wall Street Journal points out that some states are repealing state estate taxes, some are hiking state estate taxes, and some states don’t have an estate tax. It leads to a lot of confusion, particularly for families that have residences in more than one state. See State Estate Tax Changes Make Plans Trickier (July 8, 2011).
Carolyn T. Geer of the Wall Street Journal stresses the importance of properly filling out beneficiary designation forms and discusses what types of financial accounts usually have beneficiary designations, who can be named as a beneficiary, and who should not be named as a beneficiary, among other issues. See Beware the Beneficiary Form (July 6, 2011). Friday, June 24, 2011 Recent Press Coverage of Estate Planning (June 24, 2011)
Bob Carlson of Investing Daily reviews common estate planning goals and methods used for various categories of clients. Types of clients include the wealthy, moderately wealthy, blended families, couples without children, couples with special needs children, and unmarried couples. While there are common elements to every estate plan, each situation has unique requirements. See Finding Your Classic Estate Plan (June 21, 2011).
Rob Clarfeld of Forbes discusses Qualified Personal Residence Trusts (QPRT) and Intentionally Defective Grantor Trusts (IDGT) in the context of the recently changed gift tax laws. Between now and the end of 2012, it’s possible for a couple to give away up to $10 million during their lifetime, which makes both QPRTs and IDGTs attractive. QPRTs, however, are less favored because of the low interest rate environment, making this a good time to investigate IDGTs for large lifetime gifts. See Your Smartest Estate Planning Move Ever: Give Away Your House – Now! (June 22, 2011).
Friday, June 17, 2011 Recent Press Coverage of Estate Planning (June 17, 2011)
Bob Carlson of Investing Daily suggests the December 2011 changes in the federal estate tax laws should change the way many people view estate planning. Specifically, it will free many families from focusing on estate taxes and allow them to focus more on the non-tax aspects of estate planning, which Carlson reviews in detail. See The New Focus of Estate Planning (May 31, 2011).
Kelly Greene of the Wall Street Journal reports on recent cases where elder care workers have secretly married their elderly client, then start transferring funds or claiming a chunk of the inheritance. State laws have been largely ineffective in these situations, but some states are now severing the usual property rights given to spouses where fraud is apparent. Greene offers some advice on what to do if you suspect undue influence or coercion by a caregiver who married your family member. See Unholy Matrimony: How to Fight Back (June 11, 2011). Friday, June 03, 2011 Recent Press Coverage of Estate Planning (June 3, 2011)
Daniel S. Rubin, Esq., writes in the Journal of Accountancy why it’s not a good idea for estate planners and their clients to rely on the new rules for “portability” of a deceased spouse’s federal estate tax exclusion. Reasons why reliance on portability is probably a bad idea include the fact that portability is on the books only through the end of 2012, portability applies only to the federal estate tax, and not state estate taxes, and the deceased spouse’s exclusion is not indexed for inflation. See Seven Good Reasons Credit Shelter Trusts Remain Relevant (June 2011). Friday, May 27, 2011 Recent Press Coverage of Estate Planning (May 27, 2011)
Lauren Foster of Barron’s reviews five common mistakes that non-professional trustees make when managing a trust. Pitfalls include failing to keep adequate records, failing to diversify trust assets, failing to recognize conflicts of interest and treating beneficiaries and remaindermen appropriately, and expecting timely and reasonable compensation for taking on the role of trustee. See The Five Biggest Ways to Bungle a Trust (May 21, 2011).
Arden Dale of the Wall Street Journal discusses how heirs and executors of people who died in 2010 are struggling with important estate administration decisions. Part of the problem lies in that fact that executors can choose among two estate tax regimes, one with no estate tax but a complicated capital gains framework, and one with an elevated federal estate tax threshold. On top of that, the IRS hasn’t issued some important forms, which leads to questions about elections and due dates. See A Tough Call for Heirs (May 21, 2011). Tuesday, May 24, 2011 NEET Tips
NEET Tips answers questions posed by visitors to the NEET website
What is the procedure for ancillary probate administration in Vermont?
In Vermont, an interested person begins an ancillary estate proceeding by filing: (1) the ancillary petition signed by the home state fiduciary or other interested person; (2) a list of interested persons; (3) a description of the ancillary property; (4) the filing fee; and (5) an authenticated copy of the will and the probate thereof from the home state court, or other acceptable proof that the will is effective in that jurisdiction. Once the ancillary proceeding has been initiated, the probate process is much the same as a regular probate proceeding.
For more information on ancillary probate administration in Vermont, see the NEET web page:
Probate Administration Monday, May 23, 2011 NEET Tips
NEET Tips answers questions posed by visitors to the NEET website
How do you cut off an alcoholic child from an inheritance?
It’s possible to disinherit someone entirely in a will or trust, or to condition distributions from a trust on the alcoholic beneficiary meeting certain requirements, such as sobriety, before a distribution can be made. Establishing a reliable method for determining continuous sobriety may be problematic, but if the parent can settle on language they are comfortable with, the provisions can be enforced through the use of a trust.
Friday, May 20, 2011 Recent Press Coverage of Estate Planning (May 20, 2011)
Kelley Greene and Jessica Silver-Greenberg of the Wall Street Journal report that as baby boomers enter retirement, abuse of documents known as financial powers of attorney is increasing. According to the article, it takes careful planning to bulletproof these legal documents and improve the chances that banks and other financial institutions will honor them. See Power Grab! (May 14, 2011).
Deborah L. Jacobs of Forbes writes that estate planning affects women more profoundly than men, in large part because they usually outlive their spouses and have lower lifetime earnings. Without proper estate planning, women are far more likely to see their living standards compromised in retirement. For these reasons, Jacobs offers a list of estate planning questions every woman should be able to answer. See Estate Planning for Women (And the Men Who Love Them) (May 19, 2011).
Rob Clarfeld of Forbes provides several reasons why do-it-yourself estate planning is a bad idea, pointing out, for example, that legal requirements for a valid will vary from state to state. He notes that people who do their own legal planning may think everything is fine, but after their death their family and loved ones have to deal with the consequences of an inadequate estate plan. See Do It Yourself Estate Planning – A Uniquely Bad Idea! (May 17, 2011).
Paul Sullivan of the New York Times reports that the wealthy are hesitant to take advantage of unusually high gift tax exemptions, in part because they don’t want to give their money away in case they need it later, and in part because they don’t want to take away their children’s incentive to work. Some are building incentive provisions into trusts, such as income-matching distributions, but those have potential downsides too. See Wealthy Hesitate to Take a Break on Estate Taxes (May 13, 2011). | |
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Welcome to NorthEast Estates and Trusts, PLLC (NEET). NEET assists clients with Estate Planning, Probate and Estate Administration, Special Needs Planning and Advanced Estate Planning matters in Shelburne, Vermont as well as Charlotte, South Burlington, Burlington), Hinesburg, Essex, Essex Junction, Colchester, Winooski , Cambridge, Huntington, Richmond, Williston, Jericho , Underhill , Underhill Center and Fairfax. NEET also serves clients in Chittenden County, Addison County, Washington County, Lamoille County, Franklin County and Grand Isle County.
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