I’m presenting a seminar at the public library in Orem, Utah tomorrow, Wednesday, March 1st at 7 PM. The topic will be “Wills, Trusts, and Other Documents Necessary to a Good Estate Plan.” I’d love to see you there.
Unfortunately, I just learned that the library’s calendar was hacked yesterday, so you’ll have to trust me on this one.
Jonathan G. Blattmachr & Martin M. Shenkman, two major gurus in the estate planning field, seem to think a Trump administration will lead to the need for most of us to engage in some planning:
The election of Donald J. Trump as President, along with a Republican-controlled House and Senate, may lead to the most radical changes to the estate tax since it was first enacted.
I’ve only read a brief abstract from the article at this link. I’ll report back after I’ve read the actual piece. (I’m not a fan of the online viewing option for this story. Hard to read.)
As many will recall, then candidate Trump promised to eliminate the estate tax. That was then. This is now–he’s the President. What will he actually do? Will he also eliminate the estate tax’s two siblings: the gift tax and the generation skipping tax? No one knows, though many people care, especially those who preach tax fairness.
Given that married couples currently have to be worth almost $11 million dollars before the estate tax kicks in–it’s more complicated than that, but still–eliminating the estate tax is going to help only the very, very wealthy. And maybe that’s a bad (or a good) thing.
I’m here to argue for the advisor. Estate planning attorneys, life insurance and investment advisors, CPAs and financial planners. I’m betting that each and every one of them agree with the following:
Because the estate tax generates a meager 0.005 percent of annual tax collections, according to I.R.S. figures, it generates far more political debate than federal revenue. And among many tax planners, the calls aren’t so much for reform as for stability, or at least a period of benign neglect.
“Just leave it alone so we can plan,” Mr. Jenney said. “But every administration seems to want to put their own twist on the estate tax.”
As readers of this blog will remember, I posted a short piece about the news that Prince died without a will. To quote from that very brief article:
Something tells me this will neither go smoothly nor end well.
Well, look who’s a genius: Lawyers battle for control of late pop star Prince’s estate.
Veteran entertainment attorney L. Londell McMillan and CNN political commentator Van Jones were close advisers to Prince at different times in his life. Following the reclusive artist’s drug-overdose death in April, the two have ignited a family feud among his six known heirs—a sister and five half-siblings—over issues including the singer’s legacy, a memorial concert and the lawyers’ own conflicts of interest.
. . .
The development comes nearly a year after Prince’s death and offers a window into McMillan’s vision for how best to manage the estate—a view that differs in some respects from that of Jones. (emphasis supplied)
Actually, it doesn’t take much of a genius to see problems in the future when money is at issue–lots of it, in this case. I learned that years ago when I worked as a bank teller for a short time in a management training program I was in. I made a small mistake–25 cents if I recall correctly–when I entered the current balance in the customer’s passbook savings book. You would have thought that I’d just robbed Fort Knox.
Lesson? Be a real prince and have an attorney draft you a will–at least a will. And if you don’t want people peering into your estate through a “window,” have your attorney draft a revocable living trust as well. Unlike with a will (or an estate like Prince’s with no will), what goes on inside a trust is private.
I’ll be presenting a seminar on DIY — Do It Yourself — Estate Planning at the Pleasant Grove Library on Wednesday, March 8, 2017 at 7 PM. Come an enjoy the discussion. The address is 30 E Center St, Pleasant Grove.
If you have a question about wills, trusts, and other aspects of estate planning, maybe I can answer it.
At the link is an interesting piece at WealthManagement.com that compares the reasons people gave in 1927 for not making a will with the reasons people give now. It’s worth a read if for no other reason than the photographs from those bygone days are great.
That said, here are the reasons people gave in 1927:
And here’s what people say today:
There is no real good reason to not make a will–a very basic estate planning document that anyone who owns anything or who has minor children should have. And the two reasons I’ve bolded above have no merit. You can buy a do-it-yourself will online for as low as $30.00. A good attorney can draft a simple will for as little as $250.00. (Other estate planning documents–trusts, powers of attorney, and the like–are an additional cost.)
So go get that will. Tell the world who gets what when you die and who you want to be the guardian of your minor children. Just do it.
Or let your state’s law of intestacy do it all for you.
Naomi Cahn, a law professor at George Washington University, has some good advice for those who’ve recently parted ways with their spouse. You can read her advice in her piece “Protect Those You Love in Divorce, and Remarriage,” posted at Slitopia. If you find yourself a member of the recently divorced, I recommend you read it.
Everybody wants to avoid probate, but far too many of those who want to avoid it, know what is. Here’s a primer:
Probate is the legal process in which a deceased person’s will is proved valid; her personal representative or executor appointed; her property collected and preserved; and her debts, including taxes, paid. Usually, the deceased’s family hires an attorney to file the appropriate papers with the probate court to begin the process. Depending on the state and the complexity or size of the state, the probate process can be complicated or streamlined. In Utah, for example, if the deceased’s estate is under $100,000, probate can be handled via a so-called small estate affidavit, a much more simple process.
The deceased person’s personal representative (another term for executor) is the point person in the process. Essentially, a personal representative fills the shoes of the deceased. What the deceased could do if she were still alive, the personal representative does instead. Need to transfer title? The personal representative does that. Need to close a bank account. Again, the personal representative steps up. Often (but not always) named in the deceased’s will, the personal representative, once he has the court’s blessing, is the one who goes about collecting property, paying debts, and–finally–distributing what’s left to the deceased’s heirs. Often (but again, not always) this is done under court supervision, depending again on the state and the size/complexity of the estate.
Why do people say they want to avoid probate? Probably because they’ve heard it’s expensive–which it can be–or because they’ve heard it’s public–which it is; that is, it’s public in the sense that your nosey neighbor can walk down to the courthouse and ask the clerk to see your probate file. Then it really becomes public.
There are a number of ways to avoid probate the attendant publicity and some of the cost. One is to establish a revocable or living trust. For more on that, go here.
Why doves cry. Half of Prince’s estate to go to government.
What happens to your Facebook, Twitter, and Instagram persona when you die? You might want to consider that question.